![[personal profile]](https://www.dreamwidth.org/img/silk/identity/user.png){kind=small}
Loonie Parity
Sep. 20th, 2007 09:31 amFrom CBC News:
***
$1 Cdn = $1 US
Last Updated: Thursday, September 20, 2007 | 11:52 AM ET
CBC News
The Canadian dollar reached parity with the U.S. greenback on Thursday for the first time since November 1976.
The loonie briefly reached $1.0003 US on foreign exchange markets shortly before 11 a.m. ET, the Bank of Canada said. The loonie's stint at parity was brief, however, as it later slipped back to just under $1 US.
[snip]
The dollar's latest rise comes as the U.S. dollar falters against major currencies and commodity prices continue to gain strength.
The U.S. dollar hit a new record low against the euro earlier Thursday, two days after the Federal Reserve made a surprise cut of one-half of a percentage point to a key U.S. interest rate. Economists had been expecting a quarter-point rate cut.
Also giving energy to the loonie's flight has been the rising price of oil. In global commodity trading, the price of a barrel of oil was at $82.10 US, up 17 cents from Wednesday.
With the loonie quickly approaching parity with the U.S. buck, questions are arising about where the Canadian dollar goes once it passes $1 US.
"We've come a long way. It wasn't that long ago that the Canadian dollar was trading around 60 cents and people were thinking the end was near," said Steve Butler, director of foreign exchange at Scotia Capital.
[snip]
"I still think the fundamentals are so strong right now that we will see Canada continue to climb," he added.
***
Let's be clear about this. The Canadian dollar is doing well against the greenback only because the US dollar is doing so poorly against every other major currency, especially the Euro, against which it has lost over a third of its value since Dubya's re-election.
Sherry Cooper, chief economist of BMO Financial group, says that now would be a good time to merge the two currencies - go to the US dollar or create an "Amero." I disagree; why bind ourselves so much more tightly to what may be a sinking ship.
Meanwhile, as an occasional consumer I'm happy to go down south and get cheap Hershey bars, comic books and nylons to trade for favours back up here....
***
$1 Cdn = $1 US
Last Updated: Thursday, September 20, 2007 | 11:52 AM ET
CBC News
The Canadian dollar reached parity with the U.S. greenback on Thursday for the first time since November 1976.
The loonie briefly reached $1.0003 US on foreign exchange markets shortly before 11 a.m. ET, the Bank of Canada said. The loonie's stint at parity was brief, however, as it later slipped back to just under $1 US.
[snip]
The dollar's latest rise comes as the U.S. dollar falters against major currencies and commodity prices continue to gain strength.
The U.S. dollar hit a new record low against the euro earlier Thursday, two days after the Federal Reserve made a surprise cut of one-half of a percentage point to a key U.S. interest rate. Economists had been expecting a quarter-point rate cut.
Also giving energy to the loonie's flight has been the rising price of oil. In global commodity trading, the price of a barrel of oil was at $82.10 US, up 17 cents from Wednesday.
With the loonie quickly approaching parity with the U.S. buck, questions are arising about where the Canadian dollar goes once it passes $1 US.
"We've come a long way. It wasn't that long ago that the Canadian dollar was trading around 60 cents and people were thinking the end was near," said Steve Butler, director of foreign exchange at Scotia Capital.
[snip]
"I still think the fundamentals are so strong right now that we will see Canada continue to climb," he added.
***
Let's be clear about this. The Canadian dollar is doing well against the greenback only because the US dollar is doing so poorly against every other major currency, especially the Euro, against which it has lost over a third of its value since Dubya's re-election.
Sherry Cooper, chief economist of BMO Financial group, says that now would be a good time to merge the two currencies - go to the US dollar or create an "Amero." I disagree; why bind ourselves so much more tightly to what may be a sinking ship.
Meanwhile, as an occasional consumer I'm happy to go down south and get cheap Hershey bars, comic books and nylons to trade for favours back up here....
