The Canadian good news problem
With soaring commodity prices, the Canadian dollar is the top performing major currency this year, and the loonie is at a six-year high compared to a basket of global currencies. It is certainly weird to go to a finance page and see the Canadian dollar at over 83 cents against the US greenback.
And thanks to the resource boom and the very generous stimulus packages, it is possible that the Canadian economy will be at full capacity in 2021. As always, COVID will be the wild card, but vaccinations are reaching new levels and COVID cases are falling in most of the country’s cases.
Here is a very good Canadian and global Vaccine tracker. It seems Canada will soon lead the US in the percentage of citizens who received their first dose.
This is more good news for the economy – and of course, especially for our health.
However, a strong Canadian dollar creates a potential economic divide in Canada Financial Post Article…
“For example, the rising prices of lumber, grain and oil are great for Western Canada, the country’s bread basket and source of more than 90% of its crude oil production. The associated higher costs, rates, and currencies are more difficult for Ontario-based manufacturing companies and cities.
Every second job lost and still not replaced by the pandemic is in Toronto, Montreal and Vancouver. Low wage workers, women and youth are hardest hit. However, these regions and groups are unlikely to benefit directly from a strong resource-driven recovery.
The strong dollar makes it more of a challenge for manufacturing as it makes our products more expensive.