Monday, October 24, 2011

CAD near parity... again

Well I guess the loonie Yo-Yo continues its game, with the risk-on strategy, and oil prices near $90/bbl it is a sign that things are getting pulled up, as is the CAD (granted all currencies are doing good against the USD), just take a look at the Euro that has been hovering near 1.4 and the Yen that just hit an all time hi of 76 against the greenback.

The CAD is within 40 bps over being at parity again, as a rule of thumb, parity is a big barrier (up or down) for the CAD, so it may muck around this level for a few days, it may well fall back, it could also power through, although that is unlikely because the CAD as been on a tear of late.  In September we were flirting with .94 now we are at .9962.

BTW this should help to reduce inflation pressures (although higher oil prices is a problem).


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