In his recent Profit Confidential article, Canadian Dollar Poised for Long-term Strength
, Sasha Cekerevac reports that March’s number for job creation in Canada came in at over 82,000 jobs. The editor feels that this positive news will help propel the Canadian dollar higher.
“With a population approximately 1/10th the size of the U.S., it would be the equivalent of the American economy creating 820,000 new jobs in March,” says Cekerevac
In the Profit Confidential article, Cekerevac states “With the U.S. deficit pegged to hit and possibly exceed $1.3 trillion in 2012, this can’t help the U.S. dollar.”
Furthermore, Cekerevac notes that additional monetary stimulus has devalued the U.S. dollar
and pushed up commodity prices before and will do so again.
“Canada sells commodities, tons of them; from oil, to gold, to wheat and almost everything in between. The higher commodities go, the higher the Canadian dollar goes,” says Cekerevac. “This is combined with the fact that the Canadian government is very well managed financially, with some estimating that the Canadian budget deficit for this year will only be $20.0 billion.”
Cekerevac estimates a budget surplus for Canada by 2015-16. “How long until the U.S. budget deficit disappears,” asks Cekerevac? The editor doesn’t see any political will to change the direction and believes that, with it, we will see the U.S. deficit continue to soar.
“Bank of Canada Governor Mark Carney has been a strong voice in letting the markets know that inflation will not be tolerated,” says Cekerevac. “We will most certainly get a rate hike in Canada sooner than in the U.S., which should help move the Canadian dollar higher.”
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Michael Lombardi, MBA, the lead Profit Confidential editorial contributor, has just released his most recent update of Critical Warning Number Six, a breakthrough video with Lombardi’s current predictions for the U.S. economy, stock market, U.S. dollar, euro, interest rates and inflation. To see the video, visit http://www.profitconfidential.com/critical-warning-number-six.