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Brent's push above $99 lifts the Canadian dollar and reshuffles FX

The Canadian dollar overtook the yen on the day after Brent accelerated above $99, helped by improved Canadian terms of trade alongside renewed Middle East supply risks.

Reported · Written up by our desk · Major Pairs

Oil and yields set the broader backdrop, but currency performance is being reshuffled by country specific drivers, according to Action Forex. The report notes that oil linked moves, like the Canadian dollar’s rise, can fade if Brent stalls, while central bank driven repricing tends to last longer.

Brent renewed acceleration above $99 reshuffled the daily currency leaderboard, with the Canadian dollar moving ahead of the yen as the strongest major currency of the day. The yen still leads for the week, with its strength tied to expectations for a more sustained Bank of Japan tightening path, supported by upgraded Japanese Q2 GDP and wage growth.

Elsewhere, moves were described as more idiosyncratic, with AUD and NZD held back by domestic rate and growth concerns, and Treasury yields showing little response to the latest jump in oil. Action Forex also said the dollar’s recovery was tentative.

The Canadian dollar’s strength was linked more closely to the oil and energy terms of trade story than to newly effective retaliation measures. Canada’s retaliatory tariffs on US imports took effect Tuesday after trade talks collapsed last month, with duties ranging from 15% to 50% across about $27.6 billion of goods, plus doubled steel, aluminum, and iron tariffs to 50%, which had already been signaled in advance.

Latest closeBrent $95.32 ▲0.7%

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