With the price of oil rising what effect does it have on the Canadian dollar?

Iam learning to trade Forex and was considering a postion in USD/CAD.With the price of oil rising what effect does it have on the Canadian dollar?
I think you're considering a good position in that I'm bearish on the USD. The problem I have with Canada is it's high correlation to the US.





I don't know enough about Canada to say that it is a great position, but it is one that I've considered over the last 6 months. Particularly after they hit a 1 for 1 exchange rate. May not be a bad move.





I didn't really look at the other post, but it sounded pretty on point. I don't know if the writer considered the huge amounts of oil that is in Canada. If I were you, I'd look into Canada's oil reserves and their levels of oil exports over the last few years. Yes, high oil prices means Canadians will have to spend more which will adversely affect the money supply. But that is true worldwide, except guess where? Where they've got massive amounts of oil. If Canada starts to capitalize on their oil production, which they probably are given these prices, then Canadians will benefit from inexpensive prices, while they earn huge returns from their oil exports. In that sense, the correlation between the US and Canada may be less of a factor.





What needs to be weighed is the benefit of high priced Canadian oil on the Canadian economy versus weaker currency due to high US correlation. Good luck.With the price of oil rising what effect does it have on the Canadian dollar?
Hi,





Price of oil and gold affect Canadian dollar.





Specially Cad/Jpy as Canada export all its oil to Japan. Oil up that mean Canadian currency in an uptrend move.





To get the latest currency signals i recommend you the following site.





http://www.forex-signals-4u.com





Farid


Forex consultant


usamatrix@yahoo.com
That's a complex question. Ofcourse the rise of oil prices will make canadians spend more money. This will decrease the the amount of consumer surplus therefore decreasing the amount canadians buy. Now canadians will buy less imports and everyone else may or may not buy the same level of canadian exports. My guess is that canadians will run a trade surplus since they will decrease their buying habits, and their exports will remain consistent. However canadians could buy the same amount of goods as before oil prices rise. Most likely canadians will adapt like everyone does and the currency will remain the same. Or unemploment could rise and a recession could occur, weakening the canadian currrency.