Loonie Soars on Oil Price Boost

The Canadian Dollar has reached near two-month highs against the US Dollar as investors remain cautious due to volatile oil prices and geopolitical tensions.

The price of crude oil continues to support the Loonie, with the recent employment data in Canada adding to its bullish sentiment. However, a modest increase in the US Dollar's strength is limiting the upside for the USD/CAD pair.

Investors are also concerned about inflation risks stemming from rising oil prices, which may prompt the US Federal Reserve to adopt a more hawkish stance. As a result, traders are pricing in a greater possibility of at least one interest rate hike by the end of this year.