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BUSINESS REPORT: An 87 cent Canadian dollar next year? Could be

With the economy riding high, Finance Minister Bill Morneau releases his fall
economic statement.
With the economy riding high, Finance Minister Bill Morneau releases his fall economic statement. THE CANADIAN PRESS/Jonathan Hayward

Although some Canadian banks are calling for a pull back in the Canadian dollar, Scotiabank is calling for an 87 cent dollar by the end of next year.

The Loonie was 73 cents in early May and moved to over 83 cents as late as last week.

READ MORE: Canadian dollar climbs over 80 cents U.S.

But there is now a more optimistic call from JP Morgan Chase, which sees a faster surge and an 86 cent dollar by the first quarter of 2018.

Those projections assume that the Bank of Canada will be raising interest rates again this year, possibly in October and even more in 2018.

If the Canadian economy continues to grow at current levels, those rate hikes could be a given.

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With the U.S. Fed looking to hold rates steady well into next year, attracting even more money into Canada to buy our currency could give the loonie the added boost.

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