| In over 30 years, since November 1976, the US dollar | | | | The Canadian tourism industry will also suffer, as more |
| and Canadian dollar have not been par until now. As | | | | American visitors will decline as the dollar parity |
| the Canadian economy has been progressing over the | | | | discourages Americans from shopping in Canada, |
| years, the US economy seems to have fallen behind | | | | since the one time savings of up to 40%, due to the |
| with all its turmoil. The war in Iraq has not helped the | | | | dollar value, will no longer be available to Americans. |
| US economic situation but rather offset the deficit, and | | | | Although, Canadians will suffer in sales, they will gain in |
| in a move to avoid the forecasted economic | | | | purchasing from American based businesses, and |
| recession due to the credit crunch, the feds cut | | | | buying cars from the American side is becoming more |
| interests rates by 0.5 points to 4.75 percent. | | | | attractive to some Canadians. As car prices in |
| The move to cut interest rates to ease the mortgage | | | | Canada are much higher than in America, a lot of |
| industry has weakened the US dollar against foreign | | | | Canadian shoppers will find drastic savings by traveling |
| currency including the Euro, and giving the push for the | | | | south of the border to buy a car. The difference in |
| Canadian dollar to hit parity with the US dollar. One US | | | | prices may not be the greatest for all cars, but gaps in |
| dollar now buys one Canadian dollar. But the Canadian | | | | some categories such as luxury sports cars, will save |
| dollar's gain isn't only linked to the US federal interest | | | | a Canadian buyer almost $14,000 on average. |
| rate cut, but can also be seen as the Canadian | | | | But the high loony will put pressure on Canadian |
| economy has been booming in an upward gain from | | | | companies that are dependent on exporting to the US, |
| 2006 with a low inflation rate, and a red hot oil industry. | | | | who is also Canada's largest trading partner. Already, |
| This rapid progression of the Canadian dollar against | | | | in 2006 there were almost 100,000 job losses in |
| the US comes as a shock to some Canadians, who | | | | southeastern Ontario, due to the rising Canadian dollar |
| measured the Canadian dollar value at .62 USD only | | | | against the US dollar. |
| four years ago in 2002, and now hitting par seems too | | | | Even with such a massive job loss, the Canadian |
| good to be true. | | | | economy is still doing well, as the manufacturing sector |
| As Jeff Rubin, chief economist and strategist at CIBC | | | | loss a total of 289, 000 jobs since 2002, the Canadian |
| World Markets, stated, "the Canadian economy that | | | | economy has created over one million jobs in |
| once used to be the sleepy little resource backwater | | | | resources, construction, services, health care, education |
| of the North American economy is certainly turning the | | | | and financial industries, leaving the national jobless rate |
| tables on its big brother in a hurry." | | | | at 30-year low. |
| So what does all this have to do with Canadian and | | | | In contrast the Canadian dollar seems to be stronger |
| American dealings with each other? Well, for starts | | | | over the American for the time being, but only time will |
| there will be an increase in American exports as | | | | tell the future of the American dollar vs. the Canadian. |
| buying from the American markets will become | | | | If asked to predict, there is always uncertainty, but |
| cheaper for Canadians. Although, vice versa Canadian | | | | given factors such as future interest rate cuts by the |
| exports to America will also decrease, as it will simply | | | | Americans, could possibly even lower the US dollar |
| cost more for Americans to buy Canadian | | | | compared to the Canadian, and this could become |
| manufactured goods. | | | | reality in the next 6-12 months. |