USD Steadies as Oil Surges; US Jobless Claims Beat, Canada Trade Misses

The US dollar showed mixed performance as equity markets largely shrugged off a sharp rally in oil prices during Thursday's session. US initial jobless claims came in at 202K, beating the 212K estimate and signaling continued labor market resilience, which provides underlying support for the greenback. The US February trade deficit narrowed to -$57.30 billion versus the expected -$61.00 billion, a positive signal for USD fundamentals. In contrast, Canada's February trade balance deteriorated sharply to -$5.74 billion against an expected -$2.25 billion deficit, placing significant pressure on the Canadian dollar and potentially weighing on USD/CAD dynamics in favor of the US dollar. The surge in WTI crude oil prices typically supports commodity-linked currencies like CAD, but the dismal Canadian trade data may offset that tailwind. Traders should monitor USD/CAD for directional cues as the conflicting forces of rising oil and weak Canadian trade data create a complex setup. Near-term USD strength remains supported by solid employment data and improving trade figures.