The Canadian Dollar is the currency of Canada. In foreign exchange trade, it is also termed as "The Loonie". It is issued by the Bank of Canada which is also responsible for making economic and financial policies for the nation. Many central banks around the world keep Canadian Dollars as the reserve currency.
A major decline was observed in Canadian Dollar against US Dollar during the technological boom of the 1990s that was focused on United States. From that time on, it has made a strong place for itself in the international foreign exchange trading markets.
It has risen against all the major currencies, primarily because of the high prices of commodities, which are exported by Canada. Canada also holds one of the major crude oil reserves on the globe. The main costumer of Canada is United States of America. Thus if the oil prices increase, the Canadian Dollar is also strengthened.
In 2007, the Canadian Dollar rose sharply against the US Dollar because of the constant muscle of the Canadian economy and the weakness of the US currency on the world foreign exchange markets. Since most of the export and import businesses of Canada are linked with United States, so the main interest of the Canadians in the value of its currency against US Dollars is understandable.
Although the Canadian Dollar tends to move along US Dollar in the international markets, yet Canadian Dollar is considered to be more stable than its US counterpart. The swift growth in the value of the Canadian Dollar lifts the price of Canadian exports to the United States, which make up a large part of the economy. With the increase in the Canadian Dollar, it becomes easier for the Canadian industries to buy foreign material and businesses.
We recommend trading forex with Easy-Forex.