Trends in the Canadian Dollar
The Canadian dollar is an important economic indicator, both in Canada and around the world. In 2019, the Canadian dollar was ranked as the strongest currency in the G10. Strong doesn't just refer to value, but also to stability. Canada's loonie has a silly name, but its performance is serious business. In 2020, this position has changed a little bit. In 2019, the loonie actually gained about 5% when stacked up against the US dollar. Today, the loonie has lost some of that value and is projected to remain lower than other currencies like the US dollar and British Pound.
A soft Canadian dollar isn't all bad news, however. Canada exports more goods than countries like the US. A soft Canadian dollar means that Canada's exports of oil, natural gas, softwood lumber and other natural resources are more affordable for trading partners in other countries. People shouldn't be alarmed by the fall in the loonie's value. It's not a bad thing for a country like Canada, that relies heavily on trade for its economy.
For the rest of 2020, it's expected that the value of the loonie will hold steady. Currently, the value of the currency is fairly stable. The loonie is worth about 76 to 77 cents in USD every day. Canada's interest rate is also stable, for now at least. In 2019, many central banks around the world cut their interest rates. The Bank of Canada hasn't taken that step. Interest is still fairly low, at about 1.75%. It will be interesting to see if a cut is on the way. Up to half of all analysts believe that an interest rate cut will happen in 2020.
The end of 2019 was somewhat rocky for the nation. Canada's economy did take something of a hit as it entered the final quarter of 2019. In October, the country lost up to 70,000 jobs. It's possible there was some recovery later on in the year due to seasonal holiday work. No one can really say for sure until the December unemployment figures are reported. For now, it's projected that fourth-quarter growth was minimal. 2020 is expected to be a strong year for Canada's economy, thanks to improvements in trade relationships and a stable loonie.