what to do about the dollar?

The first question I was asked when I walked into a client, based out of Vancouver, BC, today was:

what should we do with our US cash?

It’s a very good question.  Since last fall, when we covered foreign exchange, a lot of Canadian companies have not been thinking about currency too much as the Canadian dollar was so weak it was favorable to their bottom lines.  However, the Canadian dollar has risen 16% in the past 11 weeks (with the biggest rally occurring in May) and closed out today at $1.10.  It seems like the Canadian dollar is definitely marching back to parity and could likely be there by year end, according to TD Securities Inc.

So, what to do?  I can’t tell you what to do with your US cash but I can tell you to:

get on the phone with Globex and talk to them about your cash position and what they think is best for your situation.

If it is truly heading back to parity then why not make some money now on the foreign exchange?  I’d hate to see you leave money on the table.

I have to say, I was also relieved to see the Bank of Canada left interest rates unchanged today.  Phew.