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Canajun Finances

My personal views and rants on home finances with a Canadian Perspective

Canadian Dollar Drops

Posted on 12/13/2006 00:00 AM | Link | Post Comment
Who cares? Don't be so Cavalier when it comes to hearing that kind of news on the radio. On the surface most Canadians go "CRAP" everything from the U.S. is going to cost more and when I go to Florida this winter everything is going to be more expensive too. While this is true, you need to remember the flip side of the coin which is that Canada's biggest trading partner might want to buy more things from us. Right now a large number of Canadian companies are in a bind because of the dollars meteoric rise and they are thinking of cutting Canadian staff, because the staff and the products they create are too expensive. If the dollar drops it becomes more attractive to set up shop in Canada (if you are American or from other countries). Keep this in mind the next time you hear about a dropping dollar. Why is the dollar dropping you may ask, well for the reason that our balance of trade with the U.S. is dropping (we are importing more things from the U.S. and/or the U.S. is NOT importing as many things from Canada). It's all nicely laid out in this article from Stats Canada (I love their daily updates, so much info to learn there). The graph shows that the drop in exports to the U.S. but our Imports have remained the same. Dropping fuel prices is helping this one out too. For me, it's a good thing, because I work for a company that exports to the U.S. a great deal! --C8j
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