The lower Canadian dollar is good for the Canadian economy and we need to get used to that fact - those sentiments seemed to be one of the central messages of a speech given by the Governor of the Bank of Canada.
Speaking at a breakfast meeting of community leaders in Ottawa, Stephen Poloz said that the lower Canadian dollar, brought about in part due to the falling price of oil, is helping other parts of the economy.
"We have already seen stronger growth in exports of non-commodity goods such as machinery and equipment, furniture, pharmaceuticals, aerospace and electronics, to name a few," Poloz said sounding like an Ontario politician singing the praises of having a lower dollar. "This is helping to offset the weakness in the resource sector tied to lower commodity prices, but this natural process will take time to translate into more investment spending and new job creation."
In a question and answer session with the media afterwards, Poloz bristled when questioned by The Rebel, that he was cheerleading a lower dollar as helping for central Canada at the expense of Western Canada.
"It's not something to cheer for," Poloz said. "We would of course prefer oil prices to be a little higher because that is an important export for Canada."
But, the bank governor continued, there is little that he or anyone else can do about the price of oil and the price of oil and the value of the Canadian dollar look like "a pair of train tracks" lowering in value in tandem.
Poloz said the flexible exchange rate which has allowed the dollar to sink lower is an important shock absorber which allows the economy to buffer some of the impact of lower oil prices but is not a panacea which will fix what ails the Canadian economy.
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