For the first time in more than two years, the loonie has reached over 80 cents U.S.
The loonie hit the level just after 10 a.m. ET. The Canadian dollar hasn’t climbed above 80 cents U.S. since June 30, 2015.
Earlier Monday, the Canadian dollar was trading at 79.91 cents US, up from Friday’s average price of 79.69 cents US.
The currency has been climbing since the middle of June when speculation the Bank of Canada might raise interest rates started in earnest. The central bank hiked its key interest rate on July 12,
its first rate increase since 2010.
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There are various reasons for the stronger loonie, according to Bank of Montreal economist Doug Porter said.
“For one, Alberta’s economy has stopped deteriorating, as it had been in a deep recession because of oil prices. But it has stabilized,” he said.
Another factor (which would be the biggest one) is the weak U.S. dollar, he said.
“It’s been quietly weakening since the beginning of the year, which has made our dollar stronger,” he said.
Although the rising loonie may be good news for some Canadians, there are also those who suffer.
“Some people, like tourists heading to the U.,S. will be happy about the stronger Canadian dollar, while others like manufacturs and investors are not so happy,” he said.
With files from the Canadian Press