Tag Archives: Canadian loonie

The Bank of Canada has cut its overnight rate for the second time in the last six months - to 0.5% - and the Canadian dollar has reacted as expected, [indeed, as intended,] putting the Canadian dollar at a six-year low in terms of dollars (-10.2%) and pound sterling (-10.4%). So why the rate cuts and competitive devaluation?

Booms — and the boom in Canadian commodities is no exception — are seldom without their unintended costs....[As the Canadian dollar appreciates versus the U.S. dollar, and with the U.S. as] its largest trading partner, falling Canadian exports could well induce a secular decline in the Canadian manufacturing base. Indeed, as the loonie soars, the inevitable question is: "How much higher before its economy gets singed?" Words: 528

The International Monetary Fund said today that it is considering classifying Canada’s dollar, nicknamed the loonie for the image of a loon on the C$1 coin, and Australia’s dollar, as reserve currencies. Words: 285