Canada

Is debt, real estate sinking the loonie?

ERIK NORLAND, SENIOR ECONOMIST AND EXECUTIVE DIRECTOR, CME GROUP

For most of the past six years, the Canadian dollar (CAD) closely tracked movements in West Texas Intermediate (WTI) crude oil. But from mid-2016, CAD began diverging, underperforming WTI significantly (Fig.1).

And the parting of ways was not the result of a generally stronger US dollar (USD). The Russian ruble, which also correlates highly with oil prices, has outperformed WTI over the...

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