Loonie Gloom: Canada’s Fluctuating Dollar Explained in New Senate Report
The Senate Committee on Banking, Trade and Commerce has released a report on the state of the Canadian loonie.
The report, titled The Fluctuating Canadian Dollar: What it means for Canadians, explains the causes and consequences of the declining dollar.
The issue:
The ailing loonie has been both a burden and a boon.
The culprit:
The decline of oil prices may be beneficial to Canadians’ gas tanks, but it isn’t as kind to our loonie -- oil prices and the dollar generally go hand in hand, and a $10 decrease in oil prices causes the dollar to fall by between three and five cents.
The impact:
This exchange rate fluctuation equals higher import prices. Since the dollar began its decline, Canadian consumers have been paying 30 to 40 % more for American-made goods. Canadians venturing to the U.S. may have also felt the sting of pricier than usual travel arrangements.
The bright side:
Canada’s manufacturing and tourism sectors are booming. Over 37,000 jobs have been created in the manufacturing sector. We’ve also had more visits from our neighbors to the south: U.S. visits to Canada increased by 8 % between 2014 and 2015, boosting Canada’s gross domestic product from $4 billion to $5 billion.
*Please note that as of July 31, 2022, the name of the Senate Committee on Banking, Trade and Commerce was changed to the Senate Committee on Banking, Commerce and the Economy. More information about this change can be found here.
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Loonie Gloom: Canada’s Fluctuating Dollar Explained in New Senate Report
The Senate Committee on Banking, Trade and Commerce has released a report on the state of the Canadian loonie.
The report, titled The Fluctuating Canadian Dollar: What it means for Canadians, explains the causes and consequences of the declining dollar.
The issue:
The ailing loonie has been both a burden and a boon.
The culprit:
The decline of oil prices may be beneficial to Canadians’ gas tanks, but it isn’t as kind to our loonie -- oil prices and the dollar generally go hand in hand, and a $10 decrease in oil prices causes the dollar to fall by between three and five cents.
The impact:
This exchange rate fluctuation equals higher import prices. Since the dollar began its decline, Canadian consumers have been paying 30 to 40 % more for American-made goods. Canadians venturing to the U.S. may have also felt the sting of pricier than usual travel arrangements.
The bright side:
Canada’s manufacturing and tourism sectors are booming. Over 37,000 jobs have been created in the manufacturing sector. We’ve also had more visits from our neighbors to the south: U.S. visits to Canada increased by 8 % between 2014 and 2015, boosting Canada’s gross domestic product from $4 billion to $5 billion.
*Please note that as of July 31, 2022, the name of the Senate Committee on Banking, Trade and Commerce was changed to the Senate Committee on Banking, Commerce and the Economy. More information about this change can be found here.