Exchange Rate

Was hoping to do an update on the latest arrears figures, but it doesn't look like they'll be released today... so, instead I'll do a post on something I kind of touched on in the last post, and is more a general interest/macroeconomic issue, exchange rates.

Obviously for we Canucks, the big'uns is the United States, and here is a look at how much one Canadian dollar is worth in US dollars going back to 1950. These are the monthly averages of the noon spot-prices for those wondering.

Up until it's collapse in 1971, the Bretton Woods system controlled international currencies, but unlike most, Canada's dollar was allowed to "float" until 1962. At that point you can see a very distinctive flattening as it then had a "fixed" value.

In 1970 the dollar was again allowed to float, this in an effort to tide inflation, at which point it's value relative to the US dollar started to climb (probably at least in part due to Nixon Shock). Soon thereafter Bretton Woods collapsed, and the value of the Canadian dollar has been floating ever since.

For much of the time the value floated up until 1976, the value of the dollar was usually above par with the US dollar, but after November 1976 the Canadian dollar weakened significantly and would not again reach par for over thirty years (September of 2007).

So, it's been a volatile last thirty years for the Canadian dollar relative to it's US counterpart, no time more then the last six. Obviously this kind of movement, particularly upwards, will play havoc with much of our economy, especially export and tourism sectors.

I also took a look at the daily stats, so for those trivia buffs out there the all-time record high for the Canadian dollar is trading at $1.1030, reached November 7th, 2007... the all-time low appears to have been $0.6179, reached on January 21, 2002. So, both relatively recent, particularly the high.

For curiosities sake, I also graphed out a few other international currencies. Mainly for my interest, but some others may find this stuff interesting, if for no other reason then to gain a historical context for what the dollar has been worth around the world. Starting with the Euro and UK Pound.

Here we have the Yen, it's obviously increased in value significantly over the last sixty years, but it's been relatively stable for the last twenty or so years... even before the onset of the "Lost Decade."

Finally we'll do the peso, just so our other NAFTA partner doesn't feel left out, and with increased globalization Mexico is becoming increasingly relevant. The dollars value has been rising relative to the peso, or conversely, the peso has been losing value, on a whole for the last fifteen years. This would obviously be advantageous to Mexico as they have become an attractive option for manufacturing goods for the rest of North America.