Canadian Dollar (CAD, Loonie)
Canadian dollar - The official monetary unit of Canada, which is abbreviated as $ or C$. For traders it is more usual designation - CAD (corresponds to ISO code 4217). In slang, the Canadian dollar is often called a Loonie, and it is a multiple of 100 cents. Interestingly, in French-speaking Canada, the Canadian dollar is most often called a piastre (fr. le piastre), and there it is equal to 100 sou as a tribute to the fact that it was once a French colony.
History of the Canadian dollar
Nevertheless, Canada's first currency was not the French dollar, but the Spanish, or rather the real, which was minted specifically for the colonies. The Canadian dollar came into circulation in 1841, when the country was in fact still a British colony. Its value was equal to the U.S. gold dollar, and it was divided into five shillings. After the appearance of the so-called British Commonwealth in 1857, which Canada joined as a Dominion, the Loonie became the official currency of the country. Some of the banknotes still bear the portrait of the Queen of England, Elizabeth II, the head of the Commonwealth, on the front side as a reminder of the past.
The history of Canada's banknotes is as rich as any other country in the world. It is worth saying at least that until the beginning of the 20th century, or more precisely until 1914, except for Canadian dollar The following were also in use in the country gold dollars и English sovereigns. They were not officially enshrined, but were legal tender until 1952.
The appearance of banknotes changed quite often, mainly due to the active counterfeiting of the Canadian dollar. According to statistics, the Looney is one of the most favorite counterfeiters' bills. Partly because Canada began to actively protect its currency quite late - only since the end of 2006, all CAD banknotes use the full set of security features: watermarks, perforations, holographic stripes, etc. The Bank of Canada is in charge of issuing the Loonie, which also determines the monetary policy of the state.
The Canadian dollar had for quite a long time had a strict peg in price to the U.S. gold dollar, only in 1950 the fixed rate was abolished. For some time after that, the Loonie was more expensive than its southern neighbor, but in 1976 it began to lose value, which allowed for 27 years to actively develop exports from Canada to the United States. The problems for exporters in this economic chain began after the gradual economically-driven depreciation of the U.S. dollar that occurred in 2005-07. In 2007, the USDCAD pair reached parity for the first time, significantly hurting Canadian consumers and exporters.
Equally problematic, and at the same time a lifesaver for Canadians, has been the geographical proximity to America. The basic export orientation toward the States has always created a high correlation between the exchange rates of national dollars. This becomes especially noticeable in times of global crises.
CAD in the Forex market
At The international currency market Forex The Canadian dollar is one of the most interesting currencies for traders. The export orientation of the country and the high interest rate make the Loonie a highly profitable player in the Carry Trade strategy. In addition, again, the proximity and active connection with the "first economy of the world" make the Canadian a little more attractive in the eyes of investors and speculators.
Canadian dollar or loonies, from the English word loonies, a polar (black-billed) loon depicted on the reverse side of the Canadian one-dollar coin. The Canadian is one of the eight largest currencies traded and used as a reserve currency, ranking sixth.
Regulator of the Canadian dollar is the Bank of Canada. Assessing the state of the country's economy, it conducts monetary policy, which affects the exchange rate of the Loonie.
Currency pairs with the Canadian dollar have sufficient interest among traders on the market . It should be noted that the economy of Canada is based on the export of gasoline, grains, wood and minerals. Profits from these commodities have a significant impact on investors' mood, and actually, on the CAD rate. In addition, any positive news for the market will have a positive impact on the CAD.
Canadian dollar bills
