The Canadian dollar extended its recovery from a 4-1/2 year low against its U.S. counterpart on Wednesday as investors bet on Canada avoiding threatened U.S. trade tariffs through negotiation and looked ahead to domestic GDP data.

The loonie was trading 0.2 per cent higher at 1.4005 to the U.S. dollar, or 71.40 U.S. cents, moving closer to the roughly 1.3985 level prevailing before Trump vowed on Monday to impose a 25 per cent tariff on imports from Canada and Mexico as one of his first executive orders.

The Canadian Dollar (CAD) tested a six-day low on Thursday, despite getting pushed back into the day’s opening bids. USD/CAD eased back below 1.3950 for the first time since November 13, but a lack of sustained momentum kept the pair pinned just below 1.4000.

The Canadian dollar CADUSD clawed back some of its decline against its U.S. counterpart on Tuesday as investors weighed the likelihood of hefty trade tariffs pledged by U.S. President-elect Donald Trump on Canadian products being implemented.