Canada's economic recovery could be in jeopardy as the country's currency is steadily heading toward parity with the U.S. dollar.
The Bank of Canada decided to leave its trendsetting interest rate steady at 0.25 percent while cautioning about the relentless rise of the dollar.
While a stronger Canadian dollar is good for "snowbirds" heading to the United State and for buying U.S.-made goods, it makes Canada's products more costly on the world market.
After being around 90 cents U.S., the Canadian dollar rose to 93.44 cents at midweek, with some economists predicting it could equal the U.S. greenback by the end of the year.
Bank governor Mark Carney warned that the higher dollar puts the strength of the economic recovery in peril. It's estimated the bank considers a fair value for the dollar with current commodity prices at about 85 cents U.S.
Deputy governor Timothy Lane said the bank "retains considerable flexibility," including so-called quantitative easing, to move the dollar back down.
For now, the bank has taken no action aside from the warnings.
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70% of Canadians not yet ready to vote again
Opinion polls find that 70 percent of Canadians oppose having another federal election now, only 11 months after the last one.
This was in response to Liberal Leader Michael Ignatieff's vow to have his Liberals defeat the minority Conservative government of Prime Minister Stephen Harper at the earliest opportunity this fall.
Ignatieff has since reassured those wary voters that his party "will not agree to form a coalition" or make a pact with the New Democrats or the Bloc Quebecois to try to out-vote and bring down the government. The plan is to form a "compassionate, moderate government of the center," he said.
Polls show the Conservatives maintain a slight lead over the Liberals in popular support.
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News in brief
- Statistics Canada says for the first time that there are more women than men in the work force. The agency said there were about 7.1 million women in paid employment during the first half of 2009, compared with 6.9 million men. It's believed this is because of layoffs and cutbacks in male-dominated industries.
- Maj. Yannick Pepin, the highest ranking Canadian killed in combat in Afghanistan, had only recently lamented the death of two soldiers under his command. Pepin, 36, along with Cpl. Jean-Francois Drouin, 31, both of Quebec, were killed by a powerful roadside bomb that hit their armored vehicle Sept. 6. At least 129 Canadian soldiers have been killed in the mission since 2002.
- Telus Corp. is buying Black's Photo Corp. for $26 million (U.S.) in order to get its products into more stores. It's a similar strategy to rival Bell Canada acquiring 750 of the Source consumer electronic stores in Canada after its U.S. corporate parent, Circuit City, went bankrupt.
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Facts and figures
The Canadian dollar was higher at 92.73 cents U.S. Friday, while the U.S. greenback returned $1.0785 Canadian, before bank exchange fees.
The Bank of Canada interest rate is unchanged at 0.25 percent and the prime lending rate is at 2.25 percent.
Stock markets are higher, with Toronto's composite index at 11,241 points and the TSX Venture index at 1,258 points.
Lotto 6-49: (Wednesday) 3, 6, 17, 27, 28 and 44; bonus 43. (Sept. 5) 12, 13, 27, 32, 45 and 46; bonus 18. Super 7: (Sept. 4) 4, 5, 9, 10, 20, 33 and 36; bonus 3.
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- Elizabeth May wants to be a candidate in British Columbia in the next federal election and hopes to win the first elected seat in Parliament for her Green Party. May must first win the nomination over Stuart Hertzog in Saanich Gulf Islands. May ran unsuccessfully in last year's election against Conservative Peter Mackay in Nova Scotia.
- Just two weeks after a tornado caused $2 million in damage in Markdale, Ontario, the village's largest employer, Chapman's Ice Cream, was destroyed by fire. The blaze was caused by sparks from a welder's torch. The company will rebuild and said it would maintain the jobs of its 400 workers.
- Workers at Safeway in Edmonton are on strike after being locked out. It affects 350 members of the United Food and Commercial Workers at the distribution center, frozen food warehouse and Lucerne ice cream plant. They rejected an offer of a 14 percent raise over three years on hourly rates of $14 to $20.
Jim Fox can be reached at firstname.lastname@example.org.