Canada Dollar Drops Sharply on US Data, Bonds Down

What a strange week for the American Dollar and the Canadian exchange rate. Cameron French of Reuters reports that:

"The Canadian dollar dropped hard on Friday, giving up most of Wednesday's big gains as strong U.S. economic signals and hawkish U.S. Federal Reserve comments boosted the greenback against most currencies.

Canadian bond prices retreated as their three-day advance ran out of steam as U.S. Treasuries weakened.

The Canadian dollar finished at C$1.2156 to the U.S. dollar, or 82.26 U.S. cents, down from C$1.2021 to the U.S. dollar, or 83.19 U.S. cents, at Thursday's session close."

The article goes on to explain that the Canadian authorities, fearful of the damage a high Canadian dollar would do to their economy, are unlikely to raise interest rates any time soon.

Articles on Exchange Rates
1. A Beginner's Guide to Exchange Rates and the Foreign Exchange Market
2. Exchange Rates: What to Use as the Base?
3. Is the Canadian Dollar Going Up in Value, or is the U.S. Dollar Going Down?
4. The Canadian Exchange Rate
5. Exchange Rates and Commodity Prices

In other news Chapter 7 of Conte and Carr's Outline of the U.S. Economy is now on the site:

CHAPTER 7: Monetary and Fiscal Policy
1. Introduction to Monetary and Fiscal Policy
2. Fiscal Policy: Budget and Taxes
3. The Income Tax
4. How High Should Taxes Be?
5. Fiscal Policy and Economic Stabilization
6. Fiscal Policy in the 1960s and 1970s
7. Fiscal Policy in the 1980s and 1990s
8. Money in the U.S. Economy
9. Bank Reserves and the Discount Rate
10. Monetary Policy and Fiscal Stabilization
11. The Growing Importance of Monetary Policy
12. A New Economy?
13. New Technologies in the New Economy
14. An Aging Workforce