Posted January 13, 2011
The US dollar and the Canadian dollar may share a geographic border, but their currencies can be worlds apart from one another at times. They can go close to parity, but would this be the case during December when we were focusing on how the currencies would act on the currency converter up until the closing days of the year? Would the US dollar be able to get the good result it wanted up until 2011 got started?
As November came to an end it was clear that the US dollar was doing well. It finished on 1.0236 against the Canadian currency and so hopefully the performance would continue.
However as things turned out it would finish the first week virtually at parity with the Canadian dollar, bagging a rate of 1.0017 in the process. So which way would it go now – would it dip below that rate or put some effort in and rise above it again?
There was a jump up immediately the next week began to 1.0064, but that would be almost as good as that particular week would get. The weekly high was 1.0121, but by the time the week was over the US dollar had dipped down once again, this time reaching a low of 1.0095. At least it was better than the currency had started with. However it was not showing signs of real strength and that was the worry.
So we were into week three now and as the days went by it was clear that things were not going to be brilliant for the US dollar. They simply went from day to day adjusting the exchange rate ever so slightly as they went. You would hardly notice the difference in all honesty, and eventually the week finished on 1.0073. This certainly did not look as though it would be a month of great changes one way or another.
So on we go, but this time we would see some better results over the coming days. Don’t assume they were earth shattering ones because they weren’t, but in any case they gave us all something to think about. The US dollar did manage to get its nose out in front of the Canadian dollar as it went into the 1.01 region and managed to stay there for the remainder of the week.
Were things finally beginning to look up for the US dollar? Had it saved the best for last and managed to produce a good result for the end of the month, and indeed the year?
Actually the answer might come as a disappointment, because on New Year’s Eve the final exchange rate was a lowly 0.9970. It certainly makes you wonder where the US dollar will find itself early in 2011, as the currency markets get back underway after the vacation. Perhaps we will see a stronger start to counteract the weak finish? We will have to wait and see.