The Canadian dollar fell below 71 cents U-S today for the first time in more than 12 years, triggered by the falling price of oil fueled by rising tension between Saudi Arabia and Iran.
The price of oil now trading at just under $34.00 a barrel. But even with the low, prices at the pumps are not reflecting the bargains. In St. Catharines at last check the price of gas ranges from a low of 84.8 cents a litre to just over $1.00 a litre.
The average price across the region, is around 90 cents a litre.
How may the lower loonie affect us today otherwise? You will probably feel the pangs of higher prices on imported products like electronics, coffee and fruits that are tropical. It’s not all bad news though according to some economics professors from McGill University citing that is could have some benefits in the long haul saying ” it’s one more reason why you do you’re next planned expansion in Ontario rather than in Michigan and you could expect that.”
Ultimately the low value loonie is a double-edged sword for the Canadian economy and when the exchange rate rises or falls, it’s just a price, like anything else it’s the price of foreign exchange. When a price goes up or down, one half of the market is hurt and one half of the market is helped. That’s kind of what’s going on here. Exporters love it, importers …not so much.
So far this week, the loonie has lost almost one and-a-quarter cents and some even believe the dollar will fall below 70 cents before it starts to recover.
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