It’s pretty cool that the Canadian dollar reached parity with the US during trading this past week, because I wasn’t even born back in 1976, the last time we were there. To say there’s been a sudden upsurge in Canadian flag-waving is an understatement, but the increase is due to the greenback’s weakening, as the Post points out.
Over the past five years, the United States has been struggling with declining economic conditions, including crippling deficits, that have pummelled the greenback against a large number of major currencies. It did not help, either, that U.S. interest rates have been lower than most of the rest of the world, making the currency less appealing to investors who want yield.
All this results in weakened demand for Canadian exports, which puts a lot of pressure on Canadian manufacturers that depend on business with the US. The “declining economic conditions” mentioned above are also going to drive down demand from Americans for Canadian goods, so businesses here would do well to continue diversifying their customer base in other markets.
As for me, I’m going shopping in Buffalo.
“but the increase is due to the greenback’s weakening”
That’s not 100% true. While the increase is certainly due in part to the greenback’s weakening, many people do not consider that the Canadian dollar has improved compared to other currencies, such as the Euro. The increase isn’t as dramatic, but it’s good times for the dollar.
Heh heh, I’m working with a US team, poor guys are having to spend more than one USD to hit one loonie. Being told you’re living a part of history doesn’t really make up for the suckage.
Chris is also correct in pointing out that we’re, well some of us are, also enjoying the effects of having a PetroDollar, which has contributed to the rise in our currency’s value too.