The currency pair declines after a weekend pause in US-led military hostilities reduces demand for the safe-haven USD.
USD/CAD dropped to 1.4080 during Asian trading on Monday, reversing minor gains from the previous session. The decline follows a sharp retreat in the US Dollar as easing geopolitical tensions reduce risk aversion.
The pair had traded slightly higher in the prior session but lost momentum after reports of a temporary halt in military actions between the US and opposing forces over the weekend. No prior consensus or economic data directly influenced the move.
Markets reacted to the reduced uncertainty, with the USD weakening broadly against major currencies, including the Canadian Dollar.