Canadian Dollar Soars

"The Canadian dollar topped 99 cents (U.S.) Wednesday on the back of surging oil and gold prices, a weakening U.S. dollar and as traders bet on the increasing likelihood of parity. The last time the Canadian dollar was at parity was Nov. 25, 1976."

"The surge spells good news for Canadian travellers. Not only does their dollar stretch further in the U.S., but it's also strengthened against the euro. It has risen 8.4 per cent this year and is now trading at about 0.7 euros."

This is all great news if you travel a lot, import goods, or buy your commodities at the other side of the border! However, if you are a Canadian manufacturer, you have lost your customer base (mostly American) because they cannot afford your products anymore.

"Tuesday's Fed statement indicated that the credit crunch will lead to a slowdown that's much deeper and more pronounced than most people had thought. That spells bad news for the Canadian economy because about 80 per cent of its exports go to the U.S."