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Loonie Pushes Toward Par With U.S. Dollar

Wednesday, March 10, 2010

The loonie reached a value of 97.30 cents (U.S.) in Tuesday trading, recording its eighth consecutive daily increase. It is now at its highest level since early January.

Analysts attributed the Canadian dollar's strength to a rebound in prices for crude oil -- Canada's biggest export -- and the relative weakness of the American dollar.

The loonie is also being helped by recent indications that Canada’s economy is now in recovery mode.

The loonie's fate is closely watched in the Buffalo area, since any upswing in Canadian currency is a positive development for Western New York retailers and exporters.

The recent rise in the loonie's value has triggered an influx of bargain-hunting Canadian shoppers to malls in the Buffalo and Niagara Falls, N.Y., areas. And Western New York companies have found it easier to sell their products across the border, since an increase in the loonie makes U.S. goods less expensive in Canada.

Companies based in Canada, on the other hand, have experienced a decline in exports to the United States as Canadian currency gained against the American dollar.

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