{"id":30046,"date":"2026-03-06T09:02:10","date_gmt":"2026-03-06T09:02:10","guid":{"rendered":"https:\/\/www.vtmarketsglobal.com\/en\/uncategorized\/30046\/"},"modified":"2026-03-06T09:02:10","modified_gmt":"2026-03-06T09:02:10","slug":"despite-falling-oil-prices-the-canadian-dollar-strengthens-as-usd-cad-hovers-near-1-3660-in-asia-hours-friday","status":"publish","type":"post","link":"https:\/\/www.vtmarketsglobal.com\/en\/live-updates\/30046\/","title":{"rendered":"Despite falling oil prices, the Canadian dollar strengthens as USD\/CAD hovers near 1.3660 in Asia hours Friday"},"content":{"rendered":"USD\/CAD traded near 1.3660 in Asian hours on Friday, after modest gains in the prior session. The Canadian Dollar moved higher even as lower oil prices may limit further strength because Canada is the largest crude exporter to the US.\n\nWTI fell after three days of gains and was near $77.60 at the time of writing. Prices eased after the Trump administration said it is weighing options to address a recent price rise linked to supply disruptions tied to the US-Israeli war with Iran.\n\n<h3>Hormuz Passage Support Measures<\/h3>\nBloomberg reported that Interior Secretary Doug Burgum said several measures are under review. These include insurance guarantees and naval escorts to support tanker and vessel passage through the Strait of Hormuz.\n\nThe US Dollar strengthened against major peers as some Federal Reserve officials kept open the option of further rate rises if inflation stays above target. This came as other policymakers have argued for starting rate cuts.\n\nMarkets are awaiting Friday\u2019s US Nonfarm Payrolls report, expected at about 59K for February after 130K in January. Retail Sales are expected to drop 0.3% month-on-month in January after no change in the prior month.\n\nLooking back to this time last year, we saw USD\/CAD trading around 1.3660 as the market weighed Canadian dollar strength against falling oil prices. The primary concern was the US-Israeli conflict with Iran and its potential impact on oil tanker passage through the Strait of Hormuz. This uncertainty created significant tension for commodity-linked currencies.\n\n<h3>One Year Later Market Repricing<\/h3>\nThe US naval escort and insurance guarantee plan, which was being discussed in March 2025, was largely successful in stabilizing crude supply fears. As a result, the geopolitical risk premium has evaporated from oil prices, with WTI now trading much lower, averaging around $71.50 a barrel through February 2026. This has removed a key pillar of support for the Canadian dollar that existed during the conflict&#8217;s peak.\n\nAt this time last year, the Federal Reserve was still contemplating further rate hikes, but that stance has softened considerably. US Core PCE inflation has since cooled, falling to 2.4% year-over-year in the latest January 2026 reading. This has shifted market expectations firmly toward the Fed beginning rate cuts by this summer.\n\nThis creates a clear policy divergence, as the Bank of Canada may have less room to cut rates aggressively given the pressure on its economy from weaker commodity prices. Therefore, we see the path of least resistance for USD\/CAD as upward in the coming weeks. Traders should consider using call options on USD\/CAD to position for a potential move toward the 1.3900 level.\n\n<b><a href=\"https:\/\/www.vtmarkets.com\/trade-now\/\">Create your live VT Markets account<\/a>\u00a0and\u00a0<a href=\"https:\/\/myaccount.vtmarkets.com\/login\">start trading<\/a>\u00a0now. <\/b>\n<p>\r\n\r\n<p><strong>Start trading now &#8211; Click <a href=\"https:\/\/www.vtmarketsglobal.com\/en\/trade-now\/\">here<\/a> to create your real VT Markets account <\/strong> <\/p>\r\n<!-- \/wp:post-content -->","protected":false},"excerpt":{"rendered":"<p>USD\/CAD near 1.3660; CAD supported despite weaker oil. Traders await NFP as Fed rate outlook diverges.<\/p>\n","protected":false},"author":38,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[46],"tags":[],"class_list":["post-30046","post","type-post","status-publish","format-standard","hentry","category-live-updates"],"acf":[],"aioseo_notices":[],"featured_image_src":null,"featured_image_src_square":null,"author_info":{"display_name":"josephine","author_link":"https:\/\/www.vtmarketsglobal.com\/en\/author\/josephine\/"},"_links":{"self":[{"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/posts\/30046","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/users\/38"}],"replies":[{"embeddable":true,"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/comments?post=30046"}],"version-history":[{"count":0,"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/posts\/30046\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/media?parent=30046"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/categories?post=30046"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/tags?post=30046"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}