Posted by Allison on 17 September 2018, 17:56
As 2018 got underway, the US dollar had a rate of 1.2539 against the Canadian dollar. While there were the understandable ups and downs throughout January, the overall picture was in favour of the Canadian dollar. By the end of the month, the American dollar was down to 1.2274, losing around two and a half cents in the process. Would this be key to the year ahead or was it too early to predict the overall pattern?
It certainly seemed to give just a sliver of a clue to what might happen next. February provided us with a very different picture of what was to come. By the end of that month, the American dollar was in a much better place. The result? An impressive exchange rate of 1.2778 – five cents up on the closing rate for January. These first two months had indicated there was no way to determine how things would go throughout subsequent months. But perhaps there were further large swings yet to come.
We were prepared for some more surprises during March. We had good reason for this, and there were some more notable movements on the currency markets. The American dollar ended up on top once again, this time finishing the month on 1.2900. Would it continue to go in the same positive direction or would the Canadian dollar fight back as we went into April? The latter turned out to be true, with rates dipping as low as 1.25 on the markets throughout the month. However, the US dollar did recover to end it on 1.2866.
This toing and froing did cause us to ponder the potential for the US dollar to eventually hit 1.30 territory on the markets. We had to wait until the middle of June for this to happen, but it seemed to open the floodgates when it finally did. Achieving 1.3017 on 11th June, it then climbed to 1.3281 a few days later, eventually finishing the month on 1.3245. This was far from the opening rate of 1.2539 to start the year.
It also seemed to give the US dollar a firmer footing. It did not dip below the 1.30 level for quite some time after that. Indeed, we would not see this occur until 7th August, when the US currency fell to 1.2969. It was back up to 1.3079 the following day, however.
As things stand now, we have seen the occasional dip below the 1.30 level since that point in early August. It never remained that way for long. At the time of writing, the US dollar closed out the week of Friday 14th September on 1.3008. Still far from its lower rates at the start of the year, but how would the year end? We are still some way from learning the answer to that one.