USD/CAD Extends Winning Streak as Safe-Haven Demand Surges Amid Middle East Tensions

USD/CAD Extends Gains on Safe-Haven Demand and Rising Oil Risk

The USD/CAD pair continues its bullish momentum on Monday, extending its five-day winning streak amid renewed geopolitical unrest. The pair trades higher around the mid-1.3700s, with the US Dollar benefitting from risk-off sentiment triggered by direct US military strikes on Iranian nuclear sites.

The US Dollar Index (DXY) also reflects this momentum, climbing toward 99.10, its highest level in nearly two weeks.

US Airstrikes on Iran Drive Global Risk Aversion

US President Donald Trump confirmed that American forces bombed three nuclear facilities in Iran, escalating tensions in the Middle East. The move, coordinated with Israel, aims to prevent Iran from achieving nuclear capabilities.

In a Truth Social post, Trump stated that Iran’s Fordow, Natanz, and Isfahan sites were hit and warned of further military actions if Iran retaliates.

Such developments have amplified risk aversion, pushing investors toward safe-haven assets like the USD and putting pressure on risk-sensitive currencies such as the Canadian Dollar (CAD).

Oil Prices Support CAD, But Risks Dominate

While rising oil prices would typically support the commodity-linked Loonie, the gains are being capped due to uncertainty around Iran's potential retaliation, which may involve shutting the Strait of Hormuz—a critical global oil route.

Around 20–25% of the world’s oil passes through the Strait of Hormuz, and any disruption could send oil prices skyrocketing.

Despite this, the safe-haven demand for the USD appears to be the dominant theme driving the USD/CAD pair for now.

Internal Linking Suggestions (for Tredu.com):

• Live USD/CAD Chart
• Understanding Safe-Haven Currencies
• What Is the Strait of Hormuz and Why It Matters
• US Dollar Index (DXY) Explained