EU Economic Instability Rocks the Canadian Dollar - Matthew Strauss, RBC Capital Markets

Risk, Currency and the Canadian Dollar

The Canadian Dollar is known as a commodity currency but as of late the European Union financial situation is playing havoc with the Canadian currency.  Many feedyard and cattle ranchers are really getting stressed out by how violently the dollar has moved in the recent months.

As we have mentioned before on this website, it is not the ups and downs that stress you out but the volatility that keeps you up at night.  With a currency that keeps bouncing hard between 94 cents and par, producers are trying to hedge their export sales in a proactive manner.  What concerns many producers is whether or not the CDN dollar will break this trading range during the summer months.

I talked to Matthew Strauss, Senior Fixed Income and Currency Strategist, RBC Capital Markets discusses the Canadian dollar and how farm good exporters need to be proactive in their hedging.  In the interview Matthew interestingly comments that he would recommend exporters to pick up dollar contracts anywhere lower than 94 cents in the short term.  By the sounds of it it could an interesting summer for the Canadian dollar.

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