Canadian Prime Minister Justin Trudeau will announce his resignation as leader of the Liberal Party on Monday at 10:45 a.m. (1545 GMT) but he will remain in his position until a replacement is chosen. The Prime Minister’s office however has not yet commented on the upcoming press conference.
Reasons for Resignation
Trudeau’s decision to resign comes amidst plummeting poll numbers showing the Liberal Party facing a likely crushing defeat in the next election, expected by late October. His popularity has been declining for two years, fueled by public discontent over high prices and housing shortages. Recent events, including a failed attempt to demote Finance Minister Chrystia Freeland, who subsequently resigned and accused Trudeau of prioritizing “political gimmicks,” further exacerbated the situation. Since then, calls for his resignation even from within the Liberal Party intensified.
Political Implications
The Liberal leadership race, which typically takes months, will determine Trudeau’s successor. However, even an accelerated process means Trudeau will likely remain Prime Minister for a considerable period. This means he will be in office when U.S. President-elect Donald Trump assumes office, a potentially challenging scenario given Trump’s past threats of tariffs that could severely damage the Canadian economy.
Notwithstanding, opposition parties have threatened a no-confidence motion, potentially as early as the end of March, which could trigger an early election before a new leader is chosen. If this happens, Trudeau will have to lead the Liberals into the next election, despite his intention to step down as party leader.
Market Reaction
The Canadian dollar saw a 0.8% increase following news reports of Trudeau’s impending resignation, reaching its highest intraday level since December 17. Analysts attribute this to the prospect of increased political clarity.
Background on Trudeau and Opposition
Trudeau, 53, has served as Prime Minister since November 2015, winning two re-elections. His tenure marks one of the longer periods for a Canadian Prime Minister. The Conservative leader, Pierre Poilievre, gained prominence in early 2022 for his support of the “Freedom Convoy” truckers’ protest against COVID-19 vaccine mandates.
