USD/CAD Slides as Falling Oil Prices Weaken Canadian Dollar
The USD/CAD exchange rate has dropped to near 1.4113 despite falling oil prices, which is expected to continue weakening the Canadian Dollar (CAD). The US Dollar remains flat after a strong Monday, awaiting the Federal Reserve's monetary policy announcement on Wednesday.
US President Donald Trump has urged Fed Chairman Kevin Warsh to cut interest rates in the upcoming meeting, citing a good inflation report and falling costs. However, according to the CME FedWatch tool, traders see a 62% chance that the Fed will leave interest rates unchanged in the range of 3.50%-3.75%.
The WTI Oil price has declined further due to ongoing negotiations between the US and Iran, trading 2.2% lower to near $79.40. Currencies from net energy exporting economies like Canada tend to lose appeal when oil prices fall.