Having already lost 5% since the start of the year against the US dollar, the Canadian dollar risks falling by another 5% over the coming months.
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If this is the case, our loonie will only be worth 69 US cents, its lowest level since the outbreak of the COVID-19 pandemic in March 2020.
One thing is certain, with the strong return of Donald Trump to the White House and his Make America Great Again policy, the prediction of economists at National Bank Financial to see the Canadian dollar drop to 69 US cents obviously has a good chance of coming true. materialize.
Concretely, this means that at 69 US cents, we will have to pay CA$1.45 to acquire US$1.00, or a cost of CA$1,450 per tranche of US$1,000.
At the end of December 2023, the Canadian dollar was worth almost 76 US cents, which required an outlay of just under CA$1.32 to buy US$1.00. So, per US$1000, it cost us $1320. Now, we risk paying CA$130 more per US$1000.
Parenthetical: here I am only referring to the exchange rate of the two currencies. To these exchange rates, we must add exchange fees ranging from 2.8 cents to 4.00 cents per US dollar purchased, or even $28 to $40 more per US$1,000.
LES SNOWBIRDS
At this time of year, the 900,000 Canadian snowbirds, including 250,000 Quebecers, will find that their winter stay in Florida and other southern states of the United States may cost them a fortune! Just in terms of exchange rates compared to last year, we’re talking about an additional cost of around $1,300 per $10,000 of spending.
In addition to snowbirds, all Canadian travelers who stay in the United States will also be hit by the devaluation of the Canadian dollar.
THE BIG SLAP
It is in terms of everything we import in products and services from the United States that we are going to eat a whole lot financially.
As you know, the United States is by far our main trading partner, both in terms of exports and imports.
In 2023, we imported US products worth CA$374 billion. Assuming that the level of imports remains the same, we will have to spend $410 billion over one year, or $36 billion more.
OTHER TILE…
Concerning exports, it is obviously the Americans who will benefit, if the level of Canadian exports remains the same. In 2023, we exported products worth a total of CA$595 billion.
Given the appreciation of the American dollar, Americans will be able to purchase the same quantity of Canadian products while saving a little more than $50 billion.
The drama? In terms of exports of Canadian products, the return of Donald Trump at the head of the United States suggests rather dark years ahead due to the protectionist measures he intends to put in place.
Which measures would be accompanied by new customs tariffs of at least 10%.
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