The fall in oil prices undermined the loonie's reputation and helped the pair to recover. At the same time, the continuing corrective fall in the dollar can hold back any strong upward movement. Perhaps a strong report on the state of the American ISM, an index of business activity in the non-manufacturing sphere, will become a necessary impetus. The USD/CAD pair first broke through the level of 1.3200 and went further down, but soon bounced back. It is trading within six-week highs. At the beginning of the week, the pair managed to restore some positive dynamics, which was supported by a rebound in oil prices, which, as a rule, undermines the demand for commodity currencies. Despite the aggravation of geopolitical tensions in the Middle East, fears that the trade war between the United States and China could hit the global economy hard has raised concerns about rising oil demand. Recall that oil prices fell by 8%, which was the biggest daily drop in the last four years after the unexpected statement by US President Donald Trump to introduce additional tariffs on Chinese imports since September 1.

Meanwhile, renewed concerns about a full-scale trade war between the two largest economies in the world overshadowed the effect of the Fed rate cut and caused a new round of free-fall in US Treasury bond yields, which contributed to the rise in the dollar.