CIBC Sees Canadian Dollar Falling to 15-Year Lows on Weak Exports
- Economists see loonie falling below C$1.40 versus greenback
- Depreciation may be needed to offset productivity gap
Photographer: Brent Lewin/Bloomberg
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The Canadian dollar may need to fall to the lowest levels in at least 15 years to allow exporters to drive the nation’s expansion, according to CIBC Capital Markets.
Given the limited scope of relying further on mortgage and consumer debt, Canada will need to produce better outcomes from exports and business spending to fuel growth, CIBC economists Avery Shenfeld and Royce Mendes said Tuesday in a report. But relatively weak productivity is hampering the nation’s businesses, making them higher-cost producers than their U.S. counterparts, they said.