Loonie by Hélène Villeneuve
The Canadian dollar has seen an increase for almost three weeks in a row against the U.S. currency due partly to the nation’s most important export, crude oil, surging to $113 a barrel for the first time since 2008, and partly to the European Central Banks’ hiking its rates. At the markets, Canada’s currency is presently exchanged at 0.9537 against the U.S. dollar, 1.3745 against the euro, and 89.50 against the yen. By contrast, it is important to notice that over the past week, the U.S. dollar plummeted and weakened against 15 of its 16 most-traded peers.
Getting over the hurdle
The favourable dollar results come after an unexpected drop in the number of jobs in March — the first decrease in half a year. Oil prices rose as concerns over North African turmoil persist, and the analysts expect further cuts in supply. Kathy Lien, director of currency research with online currency trader GFT Forex in New York, commented on the situation: “This confirms that the Canadian economy is well, given the persistent rise in oil prices.”
However, we should not forget to mention the other side of the story: according to the Bloomberg Correlation-Weighted Currency Indexes, a measure of the 10 developed-nation currencies, the loonie decreased 1.1 per cent this past March.
According to a Statistics Canada report, employment figures showed a surprising decline last month, as mentioned earlier. The number of jobs fell by 1,500, which was substantially lower than forecasted by analysts in a Bloomberg News survey that estimated an approximate 28,000 gain. Ironically enough, the unemployment rate declined to 7.7 percent from 7.8 percent anyway, as the work force shrank by 14,900 people.
