Usd/Cad Exchange Rate Volatility

Foreign oil dependency is a major topic that is hotly debated in US politics. The United States relies on imported oil for about 40% (in 2012) of petroleum consumed and is the world’s largest consumer of oil. About 53% of the foreign oil imported is from other Western nations such as Canada, Mexico and Brazil. 28% is from the Persian Gulf, 16% from Africa and the remaining from other areas of the world. Canada is currently the leading crude oil supplier to the US. Some believe that importing oil has benefits to our economy, while others believe it is a security threat.

Oil price increases are generally thought to increase inflation and reduce economic growth. In terms of inflation, oil prices directly affect the prices of goods made with petroleum products. As mentioned above, oil prices indirectly affect costs such as transportation, manufacturing, and heating. The increase in these costs can in turn affect the prices of a variety of goods and services, as producers may pass production costs on to consumers. The extent to which oil price increases lead to consumption price increases depends on how important oil is for the production of a given type of good or service.

Even though some believe that the dollar is valued too high, it does not mean it should fall against the US dollar in the future. The Canadian dollar in recent years shows that it is almost impossible to accurately predict the evolution of exchange rate. Exchange rates depend on too many things. Economic and political conditions in the United States are some factors. The adaptation of the Canadian economy to a stronger Canadian dollar. Although Canadian dollar varies, I see good from it in the near future but it will not surpass the American

Since June 2014 the prices of oil have fallen by more than 55 percent (Bank of Canada 2015). As a net oil producer, plunging oil prices have great implications for the Canadian economies. Lower oil prices affects the Canadian terms-of-trade, defined as the relative price of exports to imports. A weakened terms-of-trade reduces national income as lesser and lesser quantities of imports can be purchased with a given set of imports. Gasoline prices also fall as a result of lower oil prices

For the last seven years Canada has become the top provider for oil to the united states edging out Saudi Arabia, its this need to produce oil on a large capacity that is fuelling the destruction of the surrounding

Recently the price for the Canadian had drop drastically from. This was possibly due to the oil crash that occurred in Alberta. Due to the large supply of oil in the Middle East, the price of oil has dropped drastically, which meant that the price of oil in Alberta also dropped. Although the price of oil has lingered about $35-40 a barrel, the break even price is $70 a barrel. The oil crash that occurred in Alberta has brought grim news as unemployment in Alberta has increased drastically.

When America’s stock market crashed, Canada’s sock market dropped immediately. Because 65% of Canada’s imports come from USA and 40% of exports were to also to America. (Elshamy, 2015) And as soon as we raised the prices on our exports America no longer wanted Canadian goods anymore.

and a high of 80.28 cents. Furthermore, depreciation of loonie also brought other negative influences to many areas in Canada. About real estate market, the value of houses dropped; prices of food in supermarkets increased; price of cars is increased. The butterfly effects of decline of crude oil took much instability to the Canadian economy and people’s daily consumptions. In “Canadian Banks Could Take Up to 7% Earnings Hit From Oil Exposure,” Shector and Pett (2015) quoted words from Fitch Ratings, that “most Canadian banks have seen no impact to their earnings or asset quality from oil's recent slide, but [we are] maintaining a cautious view on energy-related credit for several of the largest Canadian banks. Oil’s ultimate impact on these banks will be determined by the length and severity of price declines, and spillovers to the broader economy.” Oil and gas credit exposure of six largest Canadian banks and the impact on loans and recoveries historically when energy prices

a single year we have already witnessed the large decline in value of the Canadian dollar. The

The value of the Canadian dollar tends to moves in tandem with oil prices so as oil prices have been falling recently, so has the value of the Canadian dollar. A depreciation of the Canadian dollar makes Canadian exports relatively more competitive in the world market however, as Canadian exports become cheaper relative to its imports, this negatively affects the Canadian terms of trade. This

Summer is approaching and with it is coming a rise in prices. Canadians can expect to pay more for meat, salad ingredients and beer says a TD economist. This is once again in result of falling gasoline prices. The effect of a lower loonie is already making itself felt in the market. Meat was up 12.4 per cent last month, while vegetables rose 8.4 per cent compared to a year earlier. And many economists predict that it will only continue to rise. The drop in the Canadian dollar over the past couple of years is starting to exert a more visible impact on Canadian consumer prices. The dramatic decline in the Canadian dollar over the course of the past two years could increase consumer prices by 0.8 per cent this year. The loonie has sunk 30 per cent since late 2012 as the global price of

Despite of trump’s decision to rescind the north america free trade agreement that would cause pain to american businesses and workers, US-canada free trade deal goes back into effect. Thirty five american states,most in the northeastern industrial belt, have canada as their largest export market.canada has not been on trumps trade radar in the past. American economic self interest dictates its commerce with canada remain unencumbered. It follows that international corporations looking for a toehold in north america may soon find canada a useful port of call. Trump is also supporting canada in building keystone XL pipeline as that is considered to be a cleaner and safer mode of transporting crude than rail.

It is true that “...the Canadians will still extract the oil if it doesn't get sent to the U.S.; it will just be exported elsewhere.” (Levin). Most of the oil from Canada is exported to the United States by many methods, including pipeline, train, oil tanker, or ship. If the Canadian oil is already going to the United States, why not build a pipeline and transport it by the most sustainable way out of all the methods. Moreover, a pipeline is the safest and most sustainable out of all the methods of transporting oil.

The period 1990-2003 presented a notable period which affected the Canadian dollar’s ground to the United States. This was brought about by the prolonged economic surge in America which was associated with conditions that spurred growth. The US government had also invested in equipment and machinery which was integral in enhancing productivity. This brought about by a domino effect in the economy improving profits, wages and equity prices without triggering inflationary pressures. There was also low inflation forcing the American government to have a loose monetary policy that spurred economic expansion. After 2003, the Canadian currency was stronger than the US dollar due to its overall economic health. The country was not affected heavily

With the economy constantly changing, we are starting to see drastic changes in our dollar. A countries currency determines their strength in the market and their inflation rate. With a higher inflation rate, they are able to buy more and do more for a cheaper price. To help us better understand the difference between the weak dollar and the strong dollar, we will go in depth with both weak and strong dollars and its advantages and disadvantages, the currency monitor, the causes of the weak and strong dollar, and how it fluctuates and affects operations.