Economics, Econometrics and Finance
4 years ago

Real shocks make common North American currency unfavorable for Canada.

1 view
RePEc: Research Papers in Economics
Real and Monetary Shocks to the Canadian Dollar: Do Canada and the U.S Form an Optimal Currency Area?
Jack Carr, John E. Floyd

Paper Summary

The study looked at why the Canadian dollar's value compared to the US dollar has been so unpredictable. They found that real factors, like economic changes, have had a big impact on the exchange rate, rather than just monetary factors. This means that fixing the exchange rate with the US dollar might not be the best solution for Canada.

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