The Canadian dollar is feeling the effects of economic unease south of the border. Recent data indicating a slowdown in the US economy has put downward pressure on the Canadian currency.

The close trade relationship between Canada and the United States means that economic difficulties in the US often translate into challenges for the Canadian economy. Investors are closely watching key economic indicators from both countries.

Analysts suggest that the Canadian dollar’s performance in the near term will largely depend on the severity and duration of the US economic slowdown.