Understanding the drivers of the Canadian dollar
FCC Senior Economist Leigh Anderson explains how the value of the Canadian dollar is decided and why a lower loonie can benefit the Canadian ag industry.
- Supply and demand (most notably the demand for oil) and interest rates are the key drivers in the value of the Canadian dollar
- Understanding what affects the Canadian dollar is important because most agricultural commodities are priced in U.S. dollars
- In most cases, a lower loonie is actually good for the Canadian ag industry