Canadian dollar flourishes amidst crisis

on July 14 2013 3:33 PM
A Canadian five-dollar bill is seen in a posed photograph in Montreal.
A Canadian five-dollar bill is seen in this posed photograph in Montreal March 10, 2011. Reuters

As the recent weeks have showed, many global currencies have been buffeted by volatile trade as well as the uncertainty as to the next decision of the US Federal Reserve as to its stimulus programs. There is one currency that has provided lucrative gains for its traders.

The Loonie or the Canadian dollar has increased in value 10% as against the Aussie dollar in the past three months. The said value increase was pushed by the relative weakness of the Australian dollar and the increasing value of the US currency. Last Friday, the Aussie-Canadian dollar pairing was being traded at 0.95 value.

The Canadian dollar's strength is based on the economy's strength together with the pending recovery of the US economy. The United States still remains as Canada's largest trading partner. with about 75% of Canadian exports going to the United States, according to a report from Reuters. In an earlier report, the International Monetary Fund had upgraded the growth expectations from 1.5% to 1.7% for the current year.

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