Rebounding WTI crude prices near $74.90 per barrel bolster the CAD, pressuring the USD/CAD pair amid geopolitical supply concerns.
USD/CAD extended losses for a second day, trading near 1.4010 in European hours as the Canadian Dollar strengthened on higher oil prices. WTI crude recovered to around $74.90 per barrel after three days of declines, supported by supply risks following a deadly Israeli airstrike in Lebanon and broader Middle East tensions.
The move follows a mixed US economic backdrop, with ADP payrolls rising just 44k in July, missing forecasts of 70k. Meanwhile, ISM Services PMI edged up to 54.1, signaling steady but uneven growth. Market focus remains on geopolitical developments, including a potential Iran-Oman shipping agreement that could ease supply fears.
Canada’s status as a major oil exporter amplifies the CAD’s sensitivity to crude price swings, with recent gains offsetting softer US data.