Investors continue to be happy with the past few weeks. Despite the US dollar ending its high streak, jobs are up and the overall outlook for the global economy is a strong one.
One currency is performing particularly well in the past few weeks - the Candian dollar, also known as the loonie. An agreement by the Organization of Petroleum Exporting Countries (OPEC) this week to cut oil output, has been a particular boon to CAD. Canada’s economy is driven by oil demand, and a cut in production will drive demand for Canadian oil. As a result, investors are eyeing the Canadian dollar and contributing to its strength.
A Canadian job report that announced an addition of 10,700 jobs in November also made investors optimistic, particularly because the job forecast expected a 20,000 job loss for November. All of these factors have led economists and investors to believe the Bank of Canada will not raise interest rates in the next year.
A Trump Effect on CAD?
The performance of the Canadian dollar over the past few months is a lesson in the unpredictable nature of foreign currency. We have seen investors claim everything from catastrophe to triumph for the Canadian dollar, with very little in between those predictions. One thing is for certain, as we rapidly approach 2017, the Canadian dollar will be a currency to watch.
