CAD Steadies as Oil Strength Offsets Mixed USD Pressure

Key Moments

USD/CAD trades near 1.3705 with little day-to-day movement as markets digest outcomes from the Trump-Xi meeting.
WTI crude advances about 0.51% to roughly $97.45, supported by ongoing concerns over supply and Strait of Hormuz flows.
The Canadian Dollar shows relative strength, particularly against the Australian Dollar, helped by firm crude prices.

Trump-Xi Meeting Leaves USD/CAD Range-Bound

USD/CAD is fluctuating without clear direction around 1.3705 on Thursday at the time of writing, showing almost no change on the session. Traders are weighing competing drivers after news from the summit between U.S. President Donald Trump and Chinese President Xi Jinping.

According to comments from a White House official cited by Reuters, the discussion between the two leaders was described as positive, with a focus on deeper economic ties. Topics reportedly included broader access for U.S. firms to Chinese markets, increased Chinese investment in the United States, and larger Chinese purchases of U.S. agricultural exports.

Both Trump and Xi also emphasized that the Strait of Hormuz must remain open and reiterated that Iran must not be allowed to obtain a nuclear weapon. These remarks helped ease some anxiety about potential disruptions to global energy supplies, although markets remain attentive to ongoing geopolitical frictions in the Middle East.

Oil Prices Firm on Supply Concerns, Lending Support to CAD

West Texas Intermediate (WTI) crude extends its advance on Thursday, climbing another 0.51% to about $97.45. The move is underpinned by persistent worries over global supply.

Data from the Energy Information Administration (EIA) indicated that crude flows through the Strait of Hormuz had already fallen during the first quarter after regional tensions intensified. Despite the reassurances from the Trump-Xi summit, the earlier decline in shipments through this key chokepoint continues to underpin oil prices.

The strength in crude is a constructive factor for the Canadian Dollar, as Canada remains the largest exporter of crude to the United States. Historically, firmer oil prices tend to bolster the commodity-linked Canadian currency. As a result, the upside in USD/CAD may be constrained even as the broader backdrop remains supportive for the U.S. Dollar.

U.S. Dollar Holds Firm as Inflation Data Back Restrictive Fed View

The U.S. Dollar Index (DXY) is largely unchanged on the day, hovering near 98.50. Recent U.S. inflation data continue to underpin expectations that monetary policy will remain restrictive.

April’s Producer Price Index (PPI) rose more than anticipated, reinforcing the view that inflation pressures are still strong. This outcome has tempered market expectations for interest rate cuts from the Federal Reserve, helping to maintain support for the greenback even as oil-driven strength supports the Canadian Dollar.

Canadian Dollar Performance Versus Major Currencies

The following table presents the intraday percentage change of the Canadian Dollar (CAD) against major currencies. On this basis, the Canadian Dollar is strongest versus the Australian Dollar.

	USD	EUR	GBP	JPY	CAD	AUD	NZD	CHF
USD		-0.00%	0.04%	0.02%	-0.01%	0.12%	-0.05%	-0.04%
EUR	0.00%		0.01%	-0.02%	-0.02%	0.07%	-0.06%	-0.04%
GBP	-0.04%	-0.01%		-0.02%	-0.04%	0.07%	-0.07%	-0.03%
JPY	-0.02%	0.02%	0.02%		-0.04%	0.09%	-0.08%	-0.07%
CAD	0.00%	0.02%	0.04%	0.04%		0.14%	-0.05%	0.02%
AUD	-0.12%	-0.07%	-0.07%	-0.09%	-0.14%		-0.16%	-0.08%
NZD	0.05%	0.06%	0.07%	0.08%	0.05%	0.16%		0.05%
CHF	0.04%	0.04%	0.03%	0.07%	-0.02%	0.08%	-0.05%

The heat map illustrates percentage moves of major currencies relative to each other. The base currency is selected from the left column and the quote currency from the top row. For instance, selecting the Canadian Dollar as the base on the left and moving across to the U.S. Dollar column shows the percentage change for CAD (base)/USD (quote).

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