USD/CAD Surges Near 1.3730 Highs on Middle East Conflict Fears

USD/CAD Surges Near 1.3730 Highs on Middle East Conflict Fears

Published: June 19, 2025 | 🖋️ Tredu FX News Team

Geopolitical Risk Drives USD Strength

The USD/CAD pair extended its bullish momentum on Thursday, climbing for a third straight session and touching 1.3730, the highest level seen since early June. The rally is fueled by intensifying fears of a wider Middle East conflict, prompting a flight to safe-haven assets like the US Dollar.

Oil Prices Rise, But CAD Fails to Benefit

Despite an uptick in crude oil prices, which typically supports the Canadian Dollar (CAD), the Loonie underperformed. The risk-off sentiment has largely offset the bullish impact of oil, as traders prioritize safety over commodity-linked currencies.

Hawkish Fed Commentary Adds Tailwind

Support for the USD was reinforced by Federal Reserve Chair Jerome Powell's hawkish remarks, reaffirming a longer period of elevated interest rates. This contrasted sharply with the Bank of Canada's more cautious tone, tilting rate differentials in favor of the greenback.

What to Watch Next

• Geopolitical updates on the US-Iran situation
• Crude oil price fluctuations
• Upcoming Canadian retail sales data
• Further Fed commentary on inflation path

Explore More on Tredu:

• USD/CAD Live Rate Tracker
• Crude Oil Impact on Forex
• Latest Fed News & Speeches