Greenback in the spotlight again
On Friday, we got an early look at our new Finance Minister, Bill Morneau and his take on the Canadian economy is far from rosy. Growth forecasts for this year and the next have been downgraded, there are fears about the economic outlook and the budget deficit is estimated to be at least $3 billion. In short, Mr. Morneau believes that our economy has not performed as well as we would have hoped. This outlook was all it took to quickly drain close to half a cent from the loonie against the greenback.
It’s difficult not to notice the striking contrast between our economy and what we see south of the 49th parallel. The current week, which will be interrupted by the Thanksgiving holiday, offers a feast of U.S. economic indicators and should continue to whet appetites for an initial key rate increase from the Federal Reserve on
December 16. Given this context, it is difficult to argue against the idea of a more robust greenback. This morning, the USD is rising against all major currencies, supported by comments by Venezuelan Oil Minister Eulogio del Pino, who anticipates crude oil prices at $25 a barrel if OPEC does not step in to stabilize the market.
