• USD/CAD has retreated from an eight-month high at 1.3889 marked on Thursday.
• The slight increase in Oil prices is providing support for the commodity-linked Canadian Dollar.
• The downside of the pair could be restrained due to increased risk aversion amid raised concerns about the US economy.

USD/CAD edges lower to near 1.3860 during the Asian session on Friday. However, the USD/CAD pair maintains its position near an eight-month high at 1.3889 recorded on Thursday. The commodity-linked Canadian Dollar (CAD) holds mild gains due to a slight upside of the crude Oil prices as Canada is the biggest crude exporter to the United States (US).

West Texas Intermediate (WTI) crude Oil price inches higher to near $76.50 per barrel at the time of writing. The price of crude Oil may find support from supply risks arising from heightened geopolitical tensions in the Middle East, despite ongoing global concerns about Oil demand.

The downside of the USD/CAD could be limited as the US Dollar (USD) may advance against its peers due to increased risk aversion. Recent manufacturing and labor market data have created a complex scenario with an economic slowdown in the US and growing expectations for a Federal Reserve rate cut. The CME's FedWatch Tool shows that traders are fully anticipating a 25-basis point rate cut on September 18.