The Canadian Dollar (CAD) is the official currency of Canada. It is subdivided into 100 cents, and is also often referred to as the “loonie” due to the loon bird featured on the one-dollar coin.
The Canadian dollar was first introduced in 1867, replacing the Canadian pound. CAD was originally pegged to the Pound Sterling. However, CAD became a floating currency in 1950. The CAD is managed by the Bank of Canada, which was founded in 1935.
The CAD is typically considered to be a ‘commodity dollar’, due to Canada’s high reliance on exports of natural resources. Some of Canada’s major exports include crude oil, natural gas, gold, and uranium. As a result, CAD has historically been affected by movements in commodity prices. However, recent policy changes by the Bank of Canada have led to CAD becoming more stable in recent years. As a result, CAD has become an increasingly popular currency for investors and foreign exchange companies alike.
The CAD is closely linked to the US Dollar (USD), and the two currencies often move in tandem. However, CAD has also been known to diverge from USD in response to changes in interest rates and inflation levels.
The Canadian dollar is also popular as a reserve currency with around 2% of world reserves being held in CAD.
In honour of the Queen’s Platinum Jubilee celebrations this week, we thought we’d take a look at which other countries (besides the UK) feature portraits