How the U.S. election could impact the loonie and your investments

With the U.S. election less than a week away, Karen Routledge’s phone keeps ringing with clients wondering what will happen to their investments after Tuesday.

The Calgary investment adviser hears wide-ranging concerns about the impact of possible tariffs, rising U.S. debt levels and interest rates. There’s curiosity about swings in the value of the loonie and what happens if it takes several days or weeks before results are known.

The election is “definitely on people’s minds,” said Routledge. “It’s not necessarily who’s in charge, but what they’re going to do once they’re in charge.”

• What questions do you have about the upcoming U.S. election? Tell us in an email to ask@cbc.ca.
• This Sunday, Cross Country Checkup is asking: What would a Donald Trump victory mean to you? What would it mean for Canada? Fill out this form and you could appear on the show or have your comment read on air.

Not only do many Canadians invest south of the border, but the state of the U.S. economy, currency and trade policies have implications for Canada and many countries around the globe.

“Our view is you don’t want to let politics influence what your long-term portfolio strategy should be. It’s like many things, it’s just market noise. It’s not anything you necessarily want to react to,” she said.

WATCH | Which states are most critical?

U.S. election will come down to 7 swing states. What about the other 43?

Political analyst Rosetta Okohson says the media focus on the seven swing states that will determine who will win the presidency can affect voter turnout and means other races and important ballot initiatives can be overlooked.

What questions do you have about the upcoming U.S. election? Tell us in an email to ask@cbc.ca.

Canada and the U.S. are each other’s largest trade partners with about $3.6 billion worth of goods and services crossing the border each day in 2023.

The election of Kamala Harris would likely mean a continuation of the status quo, experts say, while a return of Donald Trump could bring back widespread tariffs on exports to the U.S.

Election fallout

Even a Democratic sweep of the presidency, the House of Representatives and the Senate, “wouldn’t look much different from a policy perspective,” wrote economists at Desjardins in a report last month.

But a Republican sweep could bring a “Trump slump” and hurt both the U.S. and global economies, largely because of the expected drop in trade. Since the 1930s, trade experts say, no president has used tariffs as extensively as Trump did during his time in the White House.

Under President Joe Biden, the two countries have had some trade battles including tariffs on Canadian softwood lumber. However, another Trump presidency is a bigger threat, experts say, because of both his history of favouring significant tariffs (including on Canadian steel and aluminium) and his comments this campaign — calling himself the “tariff man” and saying “tariffs are the greatest thing ever invented.”

Combined…