Crypto & Forex November 3, 2025 0 Comments

Why the Canadian Dollar’s Collapse Amid Oil Slump and Fed Moves Could Upend Your Portfolio Fast—Are You Ready?

Ever wonder why the USD/CAD pair feels like it’s flirting with a breakout but then just taps the brakes? Well, here’s the scoop: the Canadian Dollar is trying to shake off the weight of sliding crude oil prices, but every time it makes a move, the U.S. Dollar flexes its muscles thanks to a shift in Fed chatter. Jerome Powell’s recent hesitation on slashing rates again this year has investors second-guessing their bets, especially amidst a lengthy U.S. government shutdown that’s making confidence wobble like a tightrope walker in the wind. Meanwhile, oil prices—the lifeblood of Canada’s economy—are wobbling too, despite OPEC+ hitting the pause button on production increases. Add to that some sour trade vibes between Ottawa and Washington, and it feels like the Loonie’s got its wings clipped for now. Curious to see how these interconnected forces are shaping the currency tug-of-war? Let’s dive in deeper. LEARN MORE

USD/CAD edges higher on Monday, up 0.20% for the day at 1.4040 at the time ot writing, but its bullish momentum appears to be fading below the 1.4050 level. The Canadian Dollar (CAD) struggles to recover, weighed down by falling Crude Oil prices, while the US Dollar (USD) benefits from a shift in market expectations after the Federal Reserve (Fed) signaled a more cautious stance on further policy easing in December.

During the press conference following last week’s monetary policy meeting, Fed Chair Jerome Powell said that another interest rate cut this year was “far from certain”, emphasizing that policymakers needed to wait until official data releases resume amid the ongoing US government shutdown. According to the CME FedWatch tool, the chances of a 25-basis-point cut in December have fallen to about 69%, down from over 90% before the meeting.

This more hawkish tone from the Fed supports the US Dollar and dampens risk appetite, especially as the US government shutdown extends into its sixth week with no resolution in sight. The prolonged fiscal impasse continues to weigh on confidence in the United States (US), limiting investors’ appetite for commodity-linked currencies such as the Loonie.

At the same time, falling Oil prices are adding pressure on the Canadian currency. West Texas Intermediate (WTI) US Oil retreats toward $60.50 after briefly rising above $61.00 earlier in the day, hurt by the strengthening US Dollar despite the Organization of the Petroleum Exporting Countries and its allies (OPEC+) announcing a pause in production hikes starting in the first quarter of 2026. This decline in Oil, Canada’s main export, further undermines the CAD’s outlook.

On the Canadian side, Commerzbank notes that recent trade tensions between Ottawa and Washington continue to weigh on sentiment. According to FX analyst Michael Pfister, “a sustainable appreciation of the Canadian Dollar is still some time away,” as economic risks continue to outweigh opportunities in the current environment.

Market participants will now focus on the release of the US Institute for Supply Management’s (ISM) Manufacturing Purchasing Managers Index (PMI) for October later in the day, a key indicator as official data publications remain suspended due to the shutdown.

US Dollar Price Today

The table below shows the percentage change of US Dollar (USD) against listed major currencies today. US Dollar was the strongest against the Swiss Franc.

	USD	EUR	GBP	JPY	CAD	AUD	NZD	CHF
USD		0.17%	0.09%	0.12%	0.19%	-0.05%	-0.02%	0.31%
EUR	-0.17%		-0.07%	-0.07%	0.02%	-0.22%	-0.17%	0.16%
GBP	-0.09%	0.07%		0.04%	0.09%	-0.12%	-0.10%	0.25%
JPY	-0.12%	0.07%	-0.04%		0.06%	-0.16%	0.00%	0.23%
CAD	-0.19%	-0.02%	-0.09%	-0.06%		-0.27%	-0.19%	0.14%
AUD	0.05%	0.22%	0.12%	0.16%	0.27%		0.05%	0.42%
NZD	0.02%	0.17%	0.10%	-0.00%	0.19%	-0.05%		0.35%
CHF	-0.31%	-0.16%	-0.25%	-0.23%	-0.14%	-0.42%	-0.35%

The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).