The Canadian dollar is steady this morning after a nearly relentless rise for the last two weeks. Since May 25th, the Loonie is up 4.5%. Combined with gains prior to that, the Canadian dollar has now regained all of the lost ground against the US dollar and is now at the same levels as early March prior to the onset of the crisis. The primary driver has been the overall financial recovery which has meant that the US dollar is no longer being held as a safe-haven. The recovery in the price of oil has also helped the Canadian dollar outperform even relative to the US dollar decline. It is now clear that the financial recovery has been primarily driven by the interference of monetary authorities around the world, and especially the Fed. The economic recovery is still taking shape but clearly lags the financial markets.
