The Canadian dollar

[twotees1218]

I am not happy about this rapid drop either - especially upset given that I spoke with my investment advisor two weeks ago when it was at 0.87 and asked what he thought.....he thought for sure it would strengthen given that the state of our economy is stronger than in the U.S. Wrong. Oh well. At least all the guest rooms are paid for and were paid at par. The wedding cost itself (about $5000) and photographer (about $4000 are in USD). We may scale back as a result. This really bites!!

[edssbride09]

I am super stressed about this... i have to pay for my wedding in February, and all the prices are USD! It was at par when i booked. This sucks! Thankfully I have a Canadian photographer so I get to pay that in CAD funds... Lets hope it starts to climb as fast as it fell...,

[MonoAmor]

Luckily we went to the States last summer and exchanged money when the rates were on par. We still have a lot of cash left over which is good for spending money, but nothing can be done about the exchange now. It really does suck because not only is it in USD, but flights and packages from Canada usually cost more too. I have more guests from the States coming than Canada because it is cheaper for them.

 

Canadians are nice people, we should get a break!!!

[Kat81]

My wedding is over BUT.... My husband gets paid in Canadian money. We have to wire it down here to the States where we live. Each time we wire we are losing like two hundred for every thousand. So if we transfer five thousand we are losing a thousand dollars!! Not fun!

[MonoAmor]

Quote:

Originally Posted by Kat81 My wedding is over BUT.... My husband gets paid in Canadian money. We have to wire it down here to the States where we live. Each time we wire we are losing like two hundred for every thousand. So if we transfer five thousand we are losing a thousand dollars!! Not fun!

Wow! That is so unfair. As if taxes and everything else aren't already taking off enough!!

[Kat81]

Quote:

Originally Posted by MonoAmor Wow! That is so unfair. As if taxes and everything else aren't already taking off enough!!

Yeah no doubt. We were talking to the bank about it the other day and they said it is because everything is getting cheaper in the States so everyone is coming here to spend their money.... He said it probably won't last long and should get back to normal as soon as everyone realizes they need to be spending in Canada!! SIGH!

[edssbride09]

I sure hope so, i just adjusted my budget to reflect the exchange rate (it was based on 1 to 1 before) and this is adding 1600-1800 dollars!!! Ouch, i am going to have to make some cuts

[dursula]

It totally makes me wish that instead of deposits down, I had paid the entire amount!

 

I'm also in the midst of etsy.com shopping for wedding accessories... and suddenly, I've lost my shopping appetite... ebay and cross-border have been cut already, but I was holding onto being able to get my garter, earrings, and headpiece from etsy!

[SunBride]

Okay, I notice that the first couple brides who started / responded to the thread have weddings a year away, so I totally wouldn't worry, there is a very good chance it goes back up again.

 

Quote:

Originally Posted by Kat81 Yeah no doubt. We were talking to the bank about it the other day and they said it is because everything is getting cheaper in the States so everyone is coming here to spend their money.... He said it probably won't last long and should get back to normal as soon as everyone realizes they need to be spending in Canada!! SIGH!

No offense, but that banker has the situation COMPLETELY wrong! Canada is suffering from the same financial crisis as the US right now which is the cause of this, it has nothing to do with people shopping in the US! There are 2 main factors (1) OIL PRICES - because Canada is a net exporter of oil (thanks to Alberta!), our dollar is very very highly affected by oil prices. The reason our dollar reached parity and above last year is because oil prices skyrocketed. Now oil prices have dropped to 70$ a barrel (they were at 150$ a barrel a couple months ago!) so the dollar is dropping with it. (2) Interest rates - The Bank of Canada (our central bank, like the Federal Reserve in the US) has brought down the country's key interest rate several times recently (including 1/2% a few weeks ago and another 1/4% this week. May not sound like a lot but it's a huge change to take place in one month). When the Canadian interest rate decreases relative to the US interest rate it makes the value of the dollar go down.

 

All this being said, the US economy and especially the government's financial situation is in much worse shape than Canada's right now. Although our stock markets have taken a huge hit in the past couple weeks, the whole sub-prime mortgage crisis that the US has been experiencing for a year has not really hit Canada because Canada doesn't have a sub-price mortgage crisis (more regulation in place to prevent those times of mortgages). And more importantly, the US gov't financial situation is much worse, they are posting HUGE deficits because of the war in Iraq whereas here in Canada we have been posting large surpluses in the past few years. We may post a small deficit in the next year due to the impending recession but it will likely be a small one while the US posts another huge one.

 

So all this to say it's just a matter of time before oil prices will go back up, and likely the canadian dollar too, it's just a question of whether it's a few weeks or months or a year. Right now most people are predicting these tough economic times to last about a year or a year and a half (although the crazy stock market crisis we've seen in the past few weeks will likely be less long than that, but a year or year and a half for the entire economy to get back on track.

 

 

P.S. Can you tell I'm an economist ? ? ? Actually I don't know shit about any of this stuff except for what I read in the papers and the fact that my two economic degrees allow me to actually semi-understand what I read. So all this is just the general consensus of what I have been reading in the news, not my own personal intelligence/beliefs.

[edssbride09]

Sunbride, thanks for that very well put synopsis of the situation!