Gina Burgio, Mortgage Agent

head_left_image

Update: Canadian Dollar vs US Dollar and The Price of Oil

Back on October 16, 2008, I posted my article "Canadian Dollar vs US Dollar and The Price of Oil" (see below) that was well received on ActiveRain. I found a chart recently that set out the estimated Oil Reserves by Country, so I thought that I would re-post my article with a link to this chart. Click Here to see the Chart.



Canadian Dollar vs US Dollar and The Price of Oil

Originally posted by me on October 16, 2008.

Many people were wondering last week why the Canadian Dollar started to lose value against the US Dollar, when it appears that the USA was in greater crisis mode in comparison to Canada.

Well here is why....

Canada is one of the world's largest producers of oil and holds oil reserves second only to Saudi Arabia, which makes Canada very reliant on its most prized commodity. It is also the largest supplier to the world's biggest oil consumer - the United States. Therfore, rising oil prices tend to be good for Canada/bad for the U.S., while falling oil prices tend to be bad for Canada/good for the U.S.

As you can see from the chart above, price movements USD/CAD and Oil are inversely correlated from each other - meaning as oil trends higher, USD/CAD tends to trend lower and vice versa.

Since January 1988, USD/CAD and Oil have had about a 68% inverse correlation to each other. This is a pretty strong correlation.

Gina Burgio

Gina Burgio, Mortgage Agent
VERICO Designer Mortgages Inc.
Toll Free: 1-877-345-6265
Fax: 1-877-345-6256
Email: gina@ginaburgio.com

VERICO LOGO

Each VERICO Broker is an independent owner operator.

Gina Burgio

Gina Burgio, Mortgage Agent
VERICO Designer Mortgages Inc.
Toll Free: 1-877-345-6265
Fax: 1-877-345-6256
Email: gina@ginaburgio.com

VERICO LOGO

Each VERICO Broker is an independent owner operator.

Comment balloon 1 commentGina Burgio • November 23 2008 08:55PM
Update: Canadian Dollar vs US Dollar and The Price of Oil
share
Back on October 16, 2008, I posted my article "Canadian Dollar vs US Dollar and The Price of Oil" (see below) that was well received on ActiveRain. I found a chart recently that set out the estimated Oil Reserves by Country, so I thought… more
Bank of Canada Hints of Possible Interest Rate Cut
share
Bank of Canada governor Mark Carney said in a speech recently that the Canadian economy has deteriorated more quickly than he had anticipated, hinting strongly he will cut interest rates at the next meeting on December 9. This is also the… more
Japan Slips into Recession
share
New numbers released by the Japanese government indicate the country has entered a recession. Japan's economy, the second largest in the world, contracted by 0. 1 percent in the third quarter, after shrinking 0. 9 percent in the second quarter… more
Grand Opening Announcement - Ancaster, Ontario
share
I am pleased to announce that the grand opening of our Ancaster office is scheduled for December 1, 2008. The new office will be located at 911 Golf Links Road in the Meadowlands area of Ancaster, Ontario. We are excited about the… more
Canadian Gov't may increase Bank Mortgage Purchases to $75 Billion
share
Finance Minister Jim Flaherty pledged today to triple the amount of mortgages the government can buy from banks to as much as C$75 billion. The Canadian Gov't, using its crown corporation, the Canadian Mortgage and Housing Corp. (CMHC),… more
Bank of Canada expected to Lower Interest Rates
share
Bank of Canada has hinted that they may cut interest rates again. Early today in Toronto, Bank of Canada Senior Deputy Governor Paul Jenkins stated, "Some further monetary stimulus will likely be required to achieve our 2 percent… more
Many Canadian Banks Scheduled to Soon Report Q3 Results
share
Many Canadian banks are scheduled to begin reporting their 3rd quarter results, starting on Nov. 25 with Bank of Montreal. Some analysts are expecting Canada's six big banks to report an average profit decline of 15 percent for Q3, the biggest… more
Europe's Top Central Banks set to Cut Rates
share
Europe's top central banks are expected to cut borrowing costs on Thursday as market focus shifts back to the economic crisis from the excitement of Barack Obama's historic election victory. Both the European Central Bank and the Bank of… more
What affects will Obama have on Canada?
share
It has been said in the past, that for Canada, being next to the United States, is like being in bed with an elephant. This statement was in specific reference to the close proximity between Canada and the United States… and the fact that the… more