Exchange Rate Dynamics of USD/CAD

The USD/CAD pair remained largely flat during the trading day on 11 August 2026, trading around 1.3935. The level was unchanged from the previous close, reflecting a modest 0.03 % decline.

Influence of Oil Prices

Oil prices continued to support the Canadian dollar. Brent futures were trading near 86 USD, while West Texas Intermediate (WTI) was near 81 USD. The rise in energy prices is attributed to heightened geopolitical tensions in the Middle East, particularly around the Strait of Hormuz, which has increased demand for safe‑haven assets and pushed the U.S. dollar higher.

Canadian Dollar Near Two‑Month Highs

USD/CAD is close to its lowest level in two months. The pair’s recent trajectory has been a bearish structure characterised by lower highs and lower lows, with the relative strength index approaching oversold territory. Technical analysis indicates that the currency remains under downward pressure below the 1.40 level, which has been a key resistance zone.

Canadian Economic Context

Strong Canadian labour‑market data and recent positive oil price momentum have bolstered the CAD. The Bank of Canada’s July policy statement highlighted a policy rate of 71 cents, while the market’s spot rate is near 72 cents. This alignment between the policy rate and the spot market supports the CAD’s resilience against the USD.

U.S. Dollar Influences

On the U.S. side, the dollar regained some strength after a week of weakness, driven by softer‑than‑expected non‑farm payroll data in July. The Federal Reserve’s stance on interest rates is being reassessed in light of the labor‑market cooling, which may reduce expectations for an immediate rate hike.

Summary of Recent Movement

  • USD/CAD: ~ 1.3935 on 11 August 2026, unchanged from the prior close.
  • Oil Prices: Brent ~ 86 USD, WTI ~ 81 USD, supporting the CAD.
  • Technical Indicators: Bearish trend below 1.40, RSI near oversold.
  • Economic Drivers: Canadian labour‑market strength, U.S. inflation easing, geopolitical risk favouring the USD.

These factors collectively explain the current stability of the USD/CAD pair and its proximity to recent two‑month lows.