Blanchett was at the Santa Barbara Film Festival over the weekend for her role in Blue Jasmine and was asked about the letter.
"It's obviously been a long and painful situation for the family, and I hope they find some resolution and peace," she said.
The letter says Allen sexually assaulted Farrow, the adopted daughter of actress Mia Farrow and Allen, in an attic when she was 7 years old.
The claims were investigated in 1993 when they were originally made and prosecutors decided not to press charges. Allen has always maintained his innocence.
The letter was the first time Farrow has spoken publicly about the allegations and comes a week after Allen was nominated for a screenwriting Oscar for his latest film.
“For so long, Woody Allen’s acceptance silenced me,” she wrote. “It felt like a personal rebuke, like the awards and accolades were a way to tell me to shut up and go away.”
Farrow alleged other instances of inappropriate behaviour and asked how people in Hollywood could continue to work with Allen.
“What if it had been your child, Cate Blanchett? Louis CK? Alec Baldwin? What if it had been you, Emma Stone? Or you, Scarlett Johansson? You knew me when I was a little girl, Diane Keaton. Have you forgotten me?,” she said.
Allen has reportedly told the Hollywood Reporter the allegations are “disgraceful” and he will be responding soon.