Canadian Dollar Tumbles as Oil Prices Defy Expectations

The Canadian dollar experienced a slight decline against its US counterpart on Thursday as investors weighed the impact of surging oil prices, renewed trade risks, and awaited US inflation data that could influence the Federal Reserve's next policy move.

Oil prices remained above $100 a barrel, with Brent crude trading at around $102 a barrel and US crude near $97. Typically, higher oil prices support the Canadian dollar due to energy exports being an essential source of Canada's trade income.

However, this support was offset by broader risk aversion and continued uncertainty over Canada-US trade relations. The loonie had weakened about 0.2% on Wednesday after trading as high as C$1.3767 per US dollar earlier in the session.