Loonie to look 'really good' in the near term with renewed optimism about NAFTA

QUEBEC -- Prime Minister Justin Trudeau on Thursday offered a cautiously optimistic assessment of free trade talks between Canada, the United States and Mexico, even as President Donald Trump appeared to dampen expectations for a breakthrough next week.

Trudeau said negotiations toward a new North American Free Trade Agreement appear to be making good progress after numerous setbacks and challenges -- although he acknowledged uncertainty remains.

"I believe we're in a moment where we're moving forward in a significant way," Trudeau said following an event in Quebec City.

"Hopefully, there will be some good news coming, but we know in these negotiations there are good moments and there are slower moments, but right now we are having a very productive moment of engaging with the United States and Mexico."

Foreign Affairs Minister Chrystia Freeland is scheduled to meet Friday in Washington with U.S. trade czar Robert Lighthizer and Mexican Economy Secretary Ildefonso Guajardo, signalling that talks have bumped up to the ministerial level as the negotiations intensify.

Canadian officials believe the best chance for reaching a quick agreement in principle will occur next week when Trudeau, Trump and Mexican President Enrique Pena Nieto meet in Peru at this year's Summit of the Americas.

But Trump played down the chances of that happening, even though he predicted Thursday that the three countries will have something to announce "fairly soon."

Trump said his own officials are keen to get a deal before Peru but he's told them: "Don't rush it, take it nice and easy. There's no rush. We get it done right or we'll terminate (NAFTA)."

In a background briefing Thursday in advance of the Peru meeting, a White House official said: "At this point, we don't anticipate substantive discussions on NAFTA at the summit."

The official added that Lighthizer, whose attendance at the summit remains uncertain, "continues to lead the negotiations with our partners separate to the summit."

Lighthizer has signalled his desire for a deal by the end of the month, before the Mexican presidential election gets underway in earnest.

Many trade experts believe an agreement in principle -- which would leave many of the details on the most challenging issues to be worked out later -- is the best that could be cobbled together in such a short time.

But it could help offset some of the uncertainty that has erupted as the U.S. swaps escalating punitive tariff measures with China.