TORONTO (Reuters) - Canada’s largest public sector union said on Friday that the strong Canadian dollar is hurting manufacturers and called on the government to take action to help pull the currency closer to its historic range.
The loonie, named for the bird on the back of the Canadian one dollar coin, has soared 25 percent against the U.S. dollar in the past seven months. The unparalleled move has stung manufacturers who sell their products in the United States.
“Our exports are down 10 percent since the start of the year,” said Jim Stanford, the economist for the Canadian Auto Workers union.
He said he thinks the strength of the Canadian dollar is largely due to “financial speculators placing a bets that our dollar is a petro currency and is going to take off as world oil prices take off.”
Canada is the biggest foreign oil supplier to the United States, and its oil sands, also called tar sands, contain the largest deposit of crude outside of Saudi Arabia.
“If the government said, for both environmental reasons and economic reasons, we’re going to slow down the rate of investments in the tar sands and we’re going to put limits on foreign takeovers of Canadian oil resources, that announcement would knock a lot of the stuffing out of the loonie,” Stanford said.
Reporting by John McCrank