USD/CAD is the number of Canadian dollars needed to buy one US dollar. Canada is a major crude oil exporter and sends most of its exports to the United States, so the pair is shaped by two things above all: the oil price and the gap between Bank of Canada and Federal Reserve interest rates. When oil rises, USD/CAD tends to fall.
Key takeaways
- The Canadian dollar accounts for about 6% of global currency trading (BIS, April 2025).
- The US dollar is the base currency, so a stronger Canadian dollar means a lower USD/CAD price.
- Oil is an influence, not a rule. Interest rate gaps and the broad US dollar can outweigh it for long periods.
- Both countries publish jobs data at 08:30 New York time, often on the same Friday, which can produce two-way moves within seconds.
- One pip is 0.0001 and is worth 10 Canadian dollars on a standard lot, about $7.41 at a price of 1.3500.
| What the quote means | Canadian dollars needed to buy one US dollar |
|---|---|
| Base / quote currency | US dollar (USD) / Canadian dollar (CAD) |
| Nickname | Loonie, after the bird on Canada’s one-dollar coin |
| CAD share of FX turnover | About 6% of trades (BIS, April 2025) |
| Pip | 0.0001, the fourth decimal place |
| Pip value, 1.00 lot | C$10 (about $7.41 at 1.3500) |
| Contract size, 1.00 lot | 100,000 USD |
| Most active window | 12:00–16:00 UTC, the North American morning |
| Central banks to watch | Bank of Canada, Federal Reserve |
| Symbol at Marketsall | USDCAD |
What is USD/CAD and how is it quoted?
The US dollar comes first, so a price of 1.3500 means one US dollar costs 1.35 Canadian dollars. A falling chart is a stronger Canadian dollar. Keep that inversion in mind whenever you read that “the loonie rallied”: on your screen, USD/CAD went down. The basics of quoting are in what forex trading is and major, minor and exotic pairs.
What moves USD/CAD?
| Driver | How it tends to work | What to watch |
|---|---|---|
| Crude oil | Oil is Canada’s largest export. Higher prices bring in more US dollars to be converted, which tends to strengthen the Canadian dollar and lower USD/CAD. | WTI crude, weekly US inventory data, what moves crude oil prices, WTI vs Brent |
| Interest rate expectations | If the Bank of Canada is expected to keep rates above the Fed, the Canadian dollar tends to gain, and the reverse. | Bank of Canada decisions, Canadian CPI, FOMC meetings |
| The US economy | Roughly three quarters of Canadian goods exports go to the United States, so US demand matters to Canada directly. | US growth data, Non-Farm Payrolls |
| Trade policy | Tariffs or changes to North American trade agreements affect the Canadian dollar more than most currencies. | Tariff announcements |
| Risk sentiment and the broad dollar | In market stress the US dollar usually rises against the Canadian dollar regardless of oil. | US Dollar Index, risk-on vs risk-off |
Oil and the dollar together
| Oil price | Broad US dollar | Typical effect on USD/CAD |
|---|---|---|
| Rising | Flat or falling | Tends to fall: both forces favour the Canadian dollar |
| Rising | Rising | Mixed: the forces offset, and the dollar often wins |
| Falling | Rising | Tends to rise: both forces work against the Canadian dollar |
| Falling | Falling | Mixed: often little net movement |
This is a tendency, not a formula. The wider relationship is covered in how the US dollar affects commodities and how the oil price affects inflation and interest rates.
When is USD/CAD most active?
| Event | Local time | UTC (summer / winter) | Frequency |
|---|---|---|---|
| Bank of Canada decision | 09:45 ET | 13:45 / 14:45 | Eight times a year |
| Canadian jobs data | 08:30 ET | 12:30 / 13:30 | Monthly, often the same day as US payrolls |
| Canadian CPI | 08:30 ET | 12:30 / 13:30 | Monthly |
| US CPI and Non-Farm Payrolls | 08:30 ET | 12:30 / 13:30 | Monthly |
| US weekly oil inventories | 10:30 ET, Wednesdays | 14:30 / 15:30 | Weekly |
When Canadian and US jobs reports land in the same second, the first move can reverse as traders digest both. Slippage is common then. See when the forex market is most active and the economic calendar.
USD/CAD pip value and position size
The Canadian dollar is the quote currency, so the pip value is fixed in Canadian dollars and changes in US dollars with the price.
| Lot size | Units | Value of 1 pip | In US dollars at 1.3500 | In US dollars at 1.4000 |
|---|---|---|---|---|
| 1.00 (standard) | 100,000 USD | C$10 | $7.41 | $7.14 |
| 0.10 (mini) | 10,000 USD | C$1 | $0.74 | $0.71 |
| 0.01 (micro) | 1,000 USD | C$0.10 | $0.07 | $0.07 |
Suppose USD/CAD is at 1.3500 (an illustrative price) and you open 0.10 lots. The position is worth $10,000. At 1:200 leverage the margin is $50. A 70-pip move against you is a C$70 loss, about $52, slightly more than the margin. Work out the size with position sizing first.
USD/CAD vs AUD/USD vs crude oil
| Feature | USD/CAD | AUD/USD | Crude oil CFD |
|---|---|---|---|
| What drives it most | Oil, rate gap, US economy | Metals and coal, China, risk appetite | Supply, demand, inventories, OPEC+ |
| Direction when commodities rise | Usually down | Usually up | Up |
| Typical volatility | Moderate | Moderate to high | High |
| Read more | This guide | AUD/USD guide | What moves crude oil prices |
What it costs to trade USD/CAD as a CFD
At Marketsall USD/CAD is traded as a CFD: no currency is delivered and your account is credited or debited with the price difference. See what a CFD is and spot FX vs CFDs.
| Cost | When it applies | Note for USD/CAD |
|---|---|---|
| Spread | Every trade, at entry | Tightest in the North American morning, wider in Asian hours when neither economy is awake |
| Commission | Not charged on currency trades at Marketsall | Cost is built into the spread |
| Swap | Positions held past the daily rollover | Depends on the Bank of Canada–Fed rate gap and your direction. Some providers apply the FX triple swap for this pair on a different day because it settles faster than most pairs. See triple swap Wednesday. |
| Slippage | Fast markets, gaps, news | Most likely on joint jobs-report days and around Bank of Canada decisions |
Key risks
Double data risk. Simultaneous US and Canadian releases can move the pair both ways within a minute.
Oil shocks. Supply disruptions or OPEC+ decisions can move the Canadian dollar outside its normal hours.
Trade policy. Tariff headlines have produced abrupt repricing.
Leverage. Ordinary daily ranges are large relative to margin at high leverage.
Risk warning. Trading CFDs carries a high level of risk since leverage can work both to your advantage and disadvantage. As a result, the products offered on this website may not be suitable for all investors because of the risk of losing all of your invested capital. You should never invest money that you cannot afford to lose, and never trade with borrowed money.
Frequently asked questions
Why does USD/CAD fall when oil prices rise?
Crude oil is Canada’s largest export and is priced in US dollars. When oil rises, Canadian exporters earn more US dollars and convert them into Canadian dollars, which increases demand for the Canadian dollar. Because the US dollar is the base currency, a stronger Canadian dollar shows up as a lower USD/CAD price.
Does USD/CAD always follow oil?
No. Oil is one influence among several. The gap between Bank of Canada and Federal Reserve interest rates, the strength of the US economy, trade policy and the broad US dollar can outweigh oil for months at a time. The link is strongest when oil moves sharply and the dollar is stable.
Why is the Canadian dollar called the loonie?
Canada’s one-dollar coin, introduced in 1987, carries an image of a loon, a bird common on Canadian lakes. The coin became known as the loonie and traders now use the name for the currency itself.
How much is one pip worth in USD/CAD?
One pip is 0.0001. On a standard lot of 100,000 US dollars a pip is worth 10 Canadian dollars. In US dollars that is 10 divided by the current price: about $7.41 at 1.3500 and about $7.14 at 1.4000.
When is USD/CAD most active?
USD/CAD is most active between 12:00 and 16:00 UTC, the North American morning. Canadian and US data at 08:30 New York time, Bank of Canada decisions at 09:45 and US oil inventory figures on Wednesdays at 10:30 are the main scheduled triggers.
Related reading
Follow the oil, check the swap
Because OPEC+ output decisions lie behind many oil moves that reach the loonie, how OPEC influences oil prices is a logical next read; to see USDCAD's swap figures and the day its triple charge falls, check where to find swap rates on MT5.
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