The loonie continues to soar this week
Posted Jul 20, 2011 10:38 pm.
This article is more than 5 years old.
It’s been a strong week so far for the Canadian loonie.
After gaining more than one per cent on Tuesday, the loonie advanced another further 27 basis points on Wednesday to close at 105.55 cents U.S.
The Bank Of Canada released a report expecting interest rates could be raised by the fall.
ATB economist Dan Sumner tells 660News, the reasons for the jump include strong commodity prices and the market going into a bit of a frenzy reacting to the Bank Of Canada report.
Also adding to the positive sentiment was optimism the U.S. and Europe will deal with their debt issues.
Sumner says he expects the level to sustain itself in the short term but any long, sustained rise makes exports from Canada very uncompetitive.
He says we’re lucky in Alberta because what we produce and export is largely energy products which are in the ground, while in Ontario it’s manufacturing and when it gets too expensive, factories can be relocated.
