USD/CAD in Focus as Trump Orders DOJ Probe Into Oil Price Gouging

USD/CAD faces potential volatility as President Trump has directed the Department of Justice to investigate major oil companies for allegedly failing to pass through lower crude oil prices to consumers at the pump. Trump stated that oil prices are 'dropping like a rock' while retail gasoline prices remain elevated, accusing companies of price gouging. This intervention carries significant implications for the Canadian dollar, given Canada's heavy reliance on oil exports. If the DOJ probe leads to regulatory pressure that further depresses oil prices, the commodity-linked CAD could face additional headwinds, pushing USD/CAD higher. Conversely, the move signals broader political pressure to lower energy costs, which could weigh on USD through reduced inflationary expectations, potentially giving the Federal Reserve more room for dovish policy adjustments. WTI crude oil has already been trending lower, and any accelerated decline could widen the differential between USD and CAD performance. Traders should monitor crude oil price action and any formal DOJ announcements for near-term directional cues on USD/CAD and other commodity-linked pairs.