Canadians are once again mystified the Canadian dollar could be trading for 94 cents US. How is this possible? The truth is, it’s not so much Canada being stronger, it’s other countries, the United States in particular, hitting a weak spell.
A high Canadian dollar isn’t great for our economy, but it does have some perks. When our dollar is high, we see more people migrating to US dollar accounts, hoping to cash in when the dollar drops again. Hey, it’s better than interest on savings accounts.
The online and cross border shoppers are enjoying a strong dollar and starting Christmas shopping a little earlier. Not so great for Canadian retailers, but it does add a kick to the last minute shopping at the malls.
Good news for borrowers as well. The Bank of Canada is thinking about extending the .25% key rate past its promised date of June 2010, in an effort to keep our economy stimulated. As for the average consumer, take advantage where you can, because we all know, what goes up, must come down.
