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View Full Version : CAD plunged below 0.70 USD



SomebodySmart
01-14-2016, 09:32 AM
The Canadian dollar currently stands below 70 cents U.S. It does not really have to be that way. What the Canadian bankers need to do is offer the inter-bank exchange rate when selling term deposits, G.I.C.'s. If you have to buy CAD at 0.72 USD and sell them back at 0.68 USD it defeates the purpose of investing. By offering the inter-bank rate this tax is eliminated and more foreign currency will be attracted to Canadian financial institutions. The bank would simply adjust its inter-bank purchases and sales if it gets a lot of foreign currency, i.e. simply sell more of that currency that day or buy less of it on the inter-bank market.