08:42 AM EDT, 04/29/2025 (MT Newswires) -- Canada's Liberals are tracking a minority win after Monday's parliamentary election that is a few seats short of a majority but there remain several close seats with vote counting continuing, said Scotiabank.

The Canadian dollar (CAD or loonie) is flat to the US dollar (USD) and very slightly outperforming other crosses on an early Tuesday of broad US dollar strength, noted the bank.

Bank of Canada pricing is unaffected by the election results, stated Scotiabank. The Canadian rates curve is performing in line with United States Treasury yields.

The lack of clear market reactions was expected given a) important external factors, b) key risks ahead including trade negotiations and fiscal policy, and c) uncertainty around the outcome itself.

Overall, it's a strong reversal compared to what had been the tracking of a massive Conservative majority not long ago, but it's well shy of the sizeable majority that the Liberals were expecting and that both 338Canada.com and the CBC's poll tracker were estimating, added the bank. That leaves both main political parties thankful that neither of them got blown out while lamenting what could have been.

If current results roughly stand, then the Liberals will be roughly 20 seats below what 338Canada and CBC's poll tracker were projecting.

Minority governments tend to be short-lived in Canada and usually last about 2.5 years or just months in some cases, according to Scotiabank. If this parliament yields an unworkable consensus around key policy matters, then the bank cannot rule out a need to go back to the electorate again if agreement on key steps forward becomes unachievable.

It's not hard to think of scenarios where there would be deep divisions in parliament on issues such as trade and fiscal policy matters.