Canadian dollar notches 13-day high after U.S.-Iran ceasefire
- By Reuters -
- Apr 08, 2026
The Canadian dollar strengthened to a near two-week high against its U.S. counterpart on Wednesday as a ceasefire agreement between the U.S. and Iran lifted investor sentiment.
Wall Street’s main indexes climbed to near one-month highs and the price of oil tumbled 16% to $94.85 a barrel, as expectations rose that energy supplies through the Strait of Hormuz could resume.
“The Canadian dollar is climbing on an improvement in risk appetite and borrowing costs, reflecting the fact that its long-standing role as a petrocurrency has eroded markedly in recent years,” Karl Schamotta, chief market strategist at Corpay, said in a note.
“Prospects for renewed capital expenditure in the (Canadian) energy sector remain dim,” Schamotta said.
The loonie was trading 0.3% higher at 1.3850 per U.S. dollar, or 72.20 U.S. cents, after touching its strongest intraday level since March 26 at 1.3825, while the U.S. dollar fell sharply against a basket of major currencies.
Safe-haven demand had helped support the greenback in recent weeks.
The pullback in oil prices led to reduced bets for tighter monetary policy from the Bank of Canada. The market was pricing in roughly one rate hike this year compared to the two it expected in recent days.
Canada’s employment report for March, due on Friday, could offer additional clues on the monetary policy outlook. Economists expect a jobs gain of 15,000 after the economy shed 84,000 jobs in February.
Canadian bond yields moved lower across the curve, tracking moves in U.S. Treasuries. The 10-year was down 6.5 basis points at 3.422%, after earlier touching its lowest level since March 18 at 3.385%.