- The USD/CAD pair strengthened as the commodity-linked Canadian dollar struggled amid growing concerns over demand for Canadian oil.
- Canada’s Prime Minister Mark Carney stated that Canadian crude remains low risk and competitive despite increasing Venezuelan exports.
- Meanwhile, the U.S. dollar held steady as cautious market sentiment prevailed ahead of Friday’s key jobs report, influenced by fragile economic data.
USD/CAD extended its winning streak to a fifth consecutive day, trading near 1.3860 during Asian session on Thursday. The pair strengthened as the commodity-linked Canadian dollar faced pressure following U.S. President Donald Trump’s indication of plans to resume Venezuelan crude imports, raising concerns about increased supply and intensified competition for Canadian oil demand.
Despite this, Prime Minister Mark Carney affirmed that Canadian crude remains low risk and competitive even amid potential growth in Venezuelan exports. Carney’s office also announced his upcoming visit to China from January 13–17, aiming to diversify Canada’s export markets beyond the United States amid ongoing uncertainty over U.S. trade policy.
Canada’s seasonally adjusted Ivey Purchasing Managers’ Index (PMI) rose to 51.9 in December 2025 from 48.4 in November, exceeding the expected 49.5 and marking a return to expansion after a month of contraction. Canada’s Trade Balance data for October is scheduled for release on Thursday.
The U.S. dollar (USD) remained steady amid a fragile U.S. economic outlook ahead of Friday’s key jobs report, which has moderated market sentiment. The U.S. Nonfarm Payrolls (NFP) for December are forecasted to show a gain of 55,000 jobs, down from 64,000 in November.
On Wednesday, the Institute for Supply Management (ISM) reported the U.S. Services PMI increased to 54.4 in December from 52.6 in November, beating the expected 52.3. Additionally, the Automatic Data Processing (ADP) Employment Change showed an increase of 41,000 jobs in December, following a revised loss of 29,000 jobs in November, though this was slightly below market expectations of 47,000.
Sources: Fxstreet
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