Is the rising Canadian dollar bad or good for our booming economy? To start with, one could look at it from both sides, first in the earlier days a high Canadian dollar could have been negative due to low exports. On the other side, now a booming economy, a high dollar is a plus because of cheaper imports.
After researching more on the topic, according to an economist from the TD Bank, Don Drummond, he thinks that the rising loonie "will drag down the economy." Many Canadians are worried about the rising dollar due to last time it rose to high amounts was because of the oil industry and it had a positive effect on the economy but this time it is due to poor world markets and believe that it is going to crash.
I have to disagree with Don Drummond. I believe that the high dollar is a positive for Canada and think that it will stay high for a longer then most people think. The rising dollar not only makes importing from other countries cheaper but can also increase labour productivity. It lowers exchange rates and strengthen our business markets. I do believe a rising dollar is a good thing for the Canadian economy.
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It's not that our dollar is rising, so much as the USD falling. As our biggest trading partner, we should still remained concerned for their economy in addition to ours.
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ReplyDeleteEven though we should still be concerned about our economy, it is a strong sign that our economy is starting to recover. Yes, certain industries will be negatively effected by the rising dollar, there are many sectors of the Canadian economy that will definetely benefit.
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