rates
A WEAKENING CANADIAN DOLLAR
Over the past five years. the value of the Canadian dollar has depreciated against the currencies of four of the country’s five largest trading partners: specifically, the Loonie declined by 18% versus the US dollar, 14% against the KoreanWon and Japanese Yen, and 8% versus China’s Yuan. (Some might be excited to note that the Canadian dollar has appreciated by 19% compared to the Mexican Peso, making margaritas that much more affordable.) In the most recent quarter, the Canadian dollar has depreciated against all five of these
currencies by between 2% (the US dollar and the Peso) and 5% (the Yen). Why does this matter to real estate in Metro Vancouver? For one, a cheaper currency encourages exports, which in turn boosts local incomes. Second, a depreciation in currency offsets at least some of the impact of BC’s foreign buyer tax, thereby better positioning real estate in this region within the international marketplace (for better or for worse).
CANADIAN DOLLAR LOSING STEAM ›
1.40
1.30
MORE
1.20
1.19
1.10
CANADIAN DOLLAR WORTH:
1.00
0.82 0.86 0.92
0.90
LESS
0.80
0.70
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 2019 2014 2015 2016 2017 2018
US DOLLAR
CHINESE YUAN
MEXICAN PESO
JAPANESE YEN
SK WON
SOURCE: US FEDERAL RESERVE
DATA: INDEXED CANADIAN-DOLLAR EXCHANGE RATES, Q1 2014 = 1.00
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