Three reasons why the Canadian dollar will plummet to nearly 60 cents by the end of next year

border_humper

border_humper

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The Canadian dollar will remain the pressure-relief valve for secular productivity challenges, trade-related uncertainty, and the prospect that the Bank of Canada will be compelled to cut rates before year-end as the Fed either remains on hold or succumbs to market pressure to tighten policy. As this plays out at the two countries’ central banks, already deep negative interest rate spreads will move deeper into negative terrain.
As all three challenges persist, if not intensify, the Canadian dollar will face unrelenting pressure, with C$1.60 to the U.S. dollar (62.5 U.S. cents) not out of reach.
As we have seen time and again, it is best to lean against any intermittent Canadian dollar rallies — the loonie is in a fundamental bear market. It says a lot that the CAD, in the face of what was a favourable “terms of trade” shock from the wartime spike in oil prices, could never muster any sustainable rally at all. Great news for domestic tourist operators and a fillip for exporters, not to mention for bargain-hunting American travelers looking for a cheap “European-style” vacation (check out Quebec City) without having to fly over the Atlantic. But bad news for most Canadians, who will see their real purchasing power erode as exporters buy their way back to recapturing lost global market share via an ever-more “competitive” exchange rate.
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Accelerate your departure plans accordingly.
 
Upvote 8
However, another, more persistent challenge is Canada’s continuously lagging productivity performance compared to the United States. In fact, since 2008, there have been only two years in which Canada attracted more real investment from abroad than what left the country. The fact that Mark Carney never addresses this weight on the Canadian dollar and the economy, considering he is an economist after all, is for him to answer to.
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Ah but see, we’re just in a “technical recession”. Give it a few months to work it self out. The economy is fine - elbows up!

:clownada
 
border_humper said:


Accelerate your departure plans accordingly.
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border_humperThe American govt is not running anti-Carney advertising in Canada. Americans are not banning Canadian products. The American Government is not telling Americans not to travel to Canada. The American govt has not banned Canadian companies from bidding on contracts. These are all actions taken by the Canadian government.
 
It’s been said before, but Americans don’t really think about Canada at all. When Hoekstra says it’s all up to Canada to get a trade deal or not, I believe him. I think the strategy appears to be to ignore the Trump administration and wait him out, but we appear to be out of road down which to kick the can.
 
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