Parity is on its way

The Canadian dollar topped 99 cents today and I expect we’ll see it match the US dollar this week or next (please remember that I’m an English professor and not an economist). This is great news for Canadians travelling to the US and to Europe (the Canadian dollar is gaining in relation to the Euro as well), but not such great news for yours truly. The cost of UVM’s annual Ottawa trip has risen significantly in the last few years, as has the US dollar value of my student loans sitting back in Canada. Sigh….

Here’s the scoop from today’s Globe and Mail:

The Canadian dollar topped 99 cents (U.S.) Wednesday on the back of surging oil and gold prices, a weakening U.S. dollar and as traders bet on the increasing likelihood of parity.

The currency rose as high as 99.18 cents, before easing to 98.51 cents after a report showed inflation at an eight-month low. The last time the Canadian dollar was at parity was Nov. 25, 1976.

The surge spells good news for Canadian travellers. Not only does their dollar stretch further in the U.S., but it’s also strengthened against the euro. It has risen 8.4 per cent this year and is now trading at about 0.7 euros.
Against the U.S. dollar, the currency has jumped 1.8 per cent in the past five trading days alone. With that kind of momentum, no one’s ruling out a near-term run to parity.