Loonie cracks 98 cents US
The Canadian loonie’s strong flight continued Tuesday as it briefly cracked 98 cents US for the first time since Feb. 3, 1977.
After going through the 98-cent plateau, the loonie later retreated. In morning trading on global foreign exchange markets, the Canadian dollar was up 0.62 of a cent at 97.90 cents US.
The loonie has been getting support from an expected cut in the key U.S. interest rate Tuesday of at least a quarter of a percentage point, as the U.S. Federal Reserve responds to signs of slower growth and a deepening housing slump.
If the Fed cuts its overnight rate by half a percentage point — and the experts say that’s a possibility — that would give an even bigger boost to the loonie.
The loonie is also seen as a “petro-dollar,” meaning it is closely tied to the rise and fall of oil markets. After hitting a record high on Monday, the price of oil was trolling more new highs on Tuesday, topping $81 US a barrel at one point.
The rest of the article is right here, but consider the effects on many of Hollywood’s current “outsourcing” woes. If the U.S. dollar continues to fall, the Canadian “Loonie” — not looking so loonie these days! — rises, well, the Gentle Folk of the North will have to ratchet up their subsidies to get American productions to come there since it might start to get… expensive.
We won’t even talk about how the buck is faring against more stable currencies, like the Euro. Though perhaps you might want to think of investing in some — in advance of the strike.