USD/CAD snaps its two-day winning streak, trading around 1.3480 during the European session on Friday. The downside of the USD/CAD pair could be attributed to the commodity-linked Canadian Dollar (CAD), which receives support from higher crude Oil prices. Given the fact that Canada is the largest Oil exporter to the United States (US).

The West Texas Intermediate (WTI) Oil price continues to rise, trading around $75.70 per barrel at the time of writing. This increase is driven by supply concerns in the Middle East. Worries about reduced Libyan Oil supplies and Iraq's plans to curb production are contributing to these supply fears, which in turn are bolstering Oil prices.

The downside for the USD/CAD pair may be limited, as the US Dollar continues to hold its recent gains after stronger-than-expected economic data released on Thursday. However, dovish comments from the Federal Reserve could restrain further upward movement for the Greenback.

Federal Reserve Atlanta President Raphael Bostic, a prominent hawk on the FOMC, indicated on Thursday that it might be "time to move" on rate cuts due to further cooling inflation and a higher-than-expected unemployment rate. However, he wants to wait for confirmation from the upcoming monthly jobs report and two inflation reports before the Fed's September meeting.

Investors await July’s US Personal Consumption Expenditure (PCE) Price Index scheduled to be released later in the North American Session, seeking clues about the future direction of US interest rates.

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