Jun 08 2009
Will Canadian dollar appreciate to par with US$ again?
To every Canadian shoppers, the exchange rate of Canadian over US dollar is always on our mind. After hitting the record high over 1.08 (CA$/US$) in Nov. 2007, Canadian dollars had been trending downwards.
When CA$ was at the lowest point in Feb. 2009 was 0.78, it felt like the miserable old days in the last twenty years.
Now the million dollar question is “Will Canadian dollar appreciate to par with US$ again?”.
Given our limited population (30M vs. 300M in US) and limited dominance in hi-tech (considering the failure of Nortel), the most valuable thing in Canada is our natural resources. Canadian dollar will be moving in tandem with natural resource prices.
When the recession is fading away, natural resource prices will move up and so will Canadian dollar . Meanwhile the huge bailout spending by the US government will significantly weaken the value of US dollar. The predication from forecasts.org is that by Oct. our loony will be in the 0.92~0.95 range.
The good time of cross border shopping will be back.