The Canadian dollar (CAD) gained ground against key currencies, with the USD/CAD dipping 0.26% to about 1.4160 during European trading on Wednesday. This rise was fueled by an increase in oil prices following President Donald Trump’s announcement that the Memorandum of Understanding with Iran was no longer in effect.
In European trading, WTI crude oil experienced a notable jump of over 2.23%, reaching around $73.6, marking a rise of more than 7% for the week. Higher oil prices generally boost the attractiveness of currencies from countries that export oil.
Looking ahead, the Canadian dollar’s trajectory will likely be influenced by upcoming labor market data set to be released on Friday. Predictions suggest that approximately 10,000 new jobs may have been created in June, a significant drop from May’s robust 87,800.
Overall, the elevated oil prices have made safe-haven assets increasingly appealing. The US Dollar Index (DXY), which measures the dollar’s value against six major currencies, has been hovering around 101.00 after bouncing back from earlier losses.
At the same time, investors are eagerly awaiting the minutes from the Federal Open Market Committee (FOMC) meeting in June, which will be made available at 6 p.m. Japan time. Market watchers will be keen to find insights regarding the Federal Reserve’s future monetary policy decisions.
