The Canadian Dollar (CAD) outperforms most of its major peers on Monday as renewed tensions in the Middle East push Oil prices higher amid fresh risks of supply disruption in the Strait of Hormuz.
At the time of writing, USD/CAD trades around 1.4144, remaining on the back foot for a fifth consecutive day
WTI trades around $74.50, up over 4% on the day. Higher crude Oil prices support the commodity-linked Loonie, given Canada’s status as a major Oil exporter. The United States (US) and Iran exchanged missile and drone attacks over the weekend, while Tehran claimed that it had once again closed the Strait of Hormuz to tanker traffic.
However, US President Donald Trump said in a Truth Social post that the strait “is OPEN, and will remain OPEN, with or without Iran.” Trump added that the US would act as the “guardian” of the Strait and be reimbursed at a rate of 20% on all cargo shipped through the waterway. The US Dollar (USD) remains volatile as traders assess the evolving situation in the Middle East. The US Dollar Index (DXY), which tracks the Greenback’s value against a basket of six major currencies, trades around 101.14 after briefly slipping below 101.00 earlier in the day.