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Gold/Mining/Energy : Gold and Silver Juniors, Mid-tiers and Producers
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To: tyc:> who wrote (57029)2/26/2008 9:23:37 PM
From: Rocket Red  Read Replies (1) of 78418
 
The Financial Post reports in its Tuesday edition the Douglas Porter, deputy chief economist with BMO Capital Markets, wonders why the loonie has been sagging lately. The Post's Drew Hasselback, writing in FP Posted, says prices for gold, oil and wheat are at record levels, but the loonie has fallen 1.5 per cent so far this year. "Like a BMW with no snow tires in a Canadian winter, the loonie just can't get any traction in 2008," Mr. Porter writes. He gives a string of dismal economic data. Canadian exports are down. Manufacturing sales are down. Wholesale trade is down. Minus car sales, Canadian retail sales dropped in December. The Bank of Canada may cut interest rates to prop up the economy. Even the central bank is chatting up rate cuts. Lower interest rates reduce demand for Canadian dollars, as they make foreigners less likely to stash their holdings in Canada. Some good news offsets the bad. The good data draw Mr. Porter back to that original assumption, which is that the Canadian dollar should not be doing that badly. "And, given the lofty level of today's commodity prices, there's even a small case to be made that the Canadian dollar may be slightly undervalued at just under parity," he says.
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