His new message for those who doubt he's prepared to
weaken the dollar if Canada's recovery veers too far off track: Just watch me.
Not exact matches
On January 17, National Bank's Stéfane Marion, one of the better Bay Street economists, wondered
if Bank of Canada Governor Stephen Poloz might adopt explicit forward guidance to
weaken the value of the
dollar.
But
if the Canadian
dollar weakens — let's say it drifts to 75 cents — Canadian companies will start to benefit again.
«It only benefits the company
if the
dollar continues to
weaken,» Modesto says.
If the Chinese central bank did nothing, the net outflow of money would cause the renminbi to
weaken against the
dollar.
If the
dollar is
weakening the gold price per ounce will often increase and vice-versa.
As I've noted before,
if you want to know exactly when the U.S. economy is about to
weaken markedly, watch the
dollar.
So,
if we sell the GBPUSD and the British pound
weakens relative to the U.S.
dollar, we will be in a profitable trade.
You benefit from Canadian over-investment only
if the Canadian
dollar strenghens, but not
if it
weakens.
A
weakening dollar helps you
if you already own foreign stocks.
The
dollar would get a kick especially
if the other central banks are just sitting there complacently because they would like their currencies to
weaken anyway.
If risk is off for whatever reason, money is being pulled out of the U.S. and the
dollar is
weakening.
The reason I'm skeptical about that is that
if you look at, first of all, what's priced in, QE in the U.S. caused the
dollar to
weaken on the announcement, but when the actual purchase was started, the
dollar started to recover.
Since then, the exchange rate against the US
dollar has shown little net change,
if anything
weakening a little (Graph 33).
If Planned Parenthood was distributing contraception services legitimately and fraudulently claiming for abortion services (really just
dollars for abortion follow - ups), then the inflated billing would
weaken the correlation between contraception and government funding.
So,
if we sell the GBPUSD and the British pound
weakens relative to the U.S.
dollar, we will be in a profitable trade.
Betty, meanwhile, will beat them both of them
if the US
dollar strengthens against the Canadian
dollar, but lose to them both
if the US
dollar weakens.
And does it make a difference based on how the USD is doing against other currencies (i.e.,
if it's only
weakening against the Canadian
dollar because oil prices shoot up, or
if it's
weakening against all currencies based on trade deficits)?
If you believe that the US economy will
weaken and this will hurt the US
dollar, you would execute a buy EUR / USD order.
If you believe that the US economy is strong and the euro will
weaken against the US
dollar you would execute a sell EUR / USD order.
It is possible that the US
dollar could enter a prolonged
weakening against other G7 currencies — especially
if energy prices rise.
If the statement is insufficiently hawkish, I would expect the US
Dollar to
weaken.
The price might list as CAD, but
if the USD
weakens, your assets of an American company operating in the US will, all else being equal, be worth less of your stronger Canadian
dollars.
Other things equal,
if the Euro continues to
weaken relative to the
dollar, European investors will be more attracted to U.S. investments than they would be otherwise, and similarly U.S. investors will have an incentive not to direct funds to Europe.
[1] That has been changing as the spreads between hedged international equity portfolios and unhedged international equity portfolios has widened considerably in recent months, and they may widen even more, all else being equal,
if other major currencies continue to
weaken relative to the U.S.
dollar.
Good news
if you are thinking of a trip down under this year though — thanks to the
weakening of the Australian
Dollar, Sydney and Melbourne were both knocked off the elite list and replaced by New York and LA.