[Pen-l] Why is Canadian dollar falling versus U.S. dollar?

[Bill Lear <rael@xxxxxxxxxx>]

The NY Times has a story today "As Dollars Pile Up, Uneasy Traders
Lower the Currency's Value" by Jack Healy

http://www.nytimes.com/2009/05/23/business/economy/23dollar.html?hpw

It says the U.S. dollar is at "its lowest point in five months this
week", and a chart accompanying the story, the dollar is compared to
"the euro, yen, British pound, Canadian dollar, Swedish krona and
Swiss franc."  The source of this is listed as "Bloomberg".

But in a May 13th story on the Bloomberg site, "Canadian Dollar
Weakens as U.S. Retail Sales Drop, Stocks Fall".

So, what is the general picture here, and is the behavior of the
Canadian dollar qualitatively different than the other currencies
versus the U.S. dollar?

I believe that the U.S. represents a very large chunk of the Canadian
export market (I think around 80%), and my guess is that as the slow
screw-the-people-save-the-bankers recovery starts/continues the Canadian
dollar will gain.

Any thoughts on the causes of this?  Crude oil prices?  Bank of Canada
interest rate cut?  Others?


Bill
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