Canadian Dollar declines as oil prices ease, US Dollar gains

USD/CAD gains ground after four days of losses, trading around 1.3820 during the Asian hours on Friday. The pair appreciates as the commodity-linked Canadian Dollar (CAD) struggles amid lower oil prices, given Canada’s status as the largest crude exporter to the United States (US).

West Texas Intermediate (WTI) oil price holds losses after experiencing volatility, trading around $91.80 per barrel at the time of writing. The WTI price is down by over 11.5% for the week, at the time of writing, after the US and Iran agreed to a two-week ceasefire.

However, crude oil prices may regain ground as Israeli strikes on Lebanon and the ongoing closure of the Strait of Hormuz strain diplomatic efforts. Israeli Prime Minister Benjamin Netanyahu said that there is “no ceasefire in Lebanon” and Israel would continue “to strike Hezbollah with full force” as the country’s military launched fresh strikes.

Reuters reported that a US State Department official confirmed that talks between Lebanon and Israel will take place next week in Washington, DC. “We can confirm that the Department will host a meeting next week to discuss ongoing ceasefire negotiations with Israel and Lebanon,” said a US official.

US Federal Reserve’s (Fed) March Meeting Minutes suggest the central bank remains in a wait-and-see stance, while acknowledging that inflationary risks linked to higher oil prices are becoming more balanced. Traders await the US Consumer Price Inflation (CPI) report due later in the North American session.