Today’s weakening Canadian dollar might not sound ideal, but it quietly gives Canadians an edge in ways most people don’t even notice.
Tourist boom
Foreign visitors automatically earn a pay increase when the Canadian dollar is weak compared to their currency. Tourists from the United States have the strongest currency advantage because their dollars go further in Canada.
Meals, hotel rooms, shopping and attractions can end up feeling like a 25–30% discount compared to prices back in America or in Europe.
More staycations
If it costs too much to vacation in the United States or Europe, Canadian families will vacation at home instead. Domestic tourism keeps money in Canada rather than sending it to other countries.
Exploring different provinces creates business for cottage industries and the less well-known national parks and ski resorts that Canadians didn’t know they had.
Cheaper exports
Canada exports billions of dollars worth of natural resources each year. From lumber to oil and agricultural products, other countries pay for those Canadian goods in U.S. dollars.
When the Canadian dollar is weaker, those exports become cheaper for other countries to buy. That extra bit of profit can help Canadian companies afford to bid aggressively on large international contracts.
Job security
International companies purchase more Canadian-made goods when those goods cost less for them to buy. Having more customers protects the jobs of Canadians working at factories or assembly plants.
When those products are exported all over the world because they are cheaper than their competitors’, those companies can continue to pay their workers and keep those assembly lines open.
Hollywood North
A lower Canadian dollar incentivizes studios in Los Angeles to shoot movies and TV shows north of the border. Filming in Vancouver and Toronto is often referred to as “Hollywood North” for a reason.
Budget Marvel movies, high-profile music videos and prime-time dramas will travel here to take advantage of the currency gap. That money flows into local film crews, construction teams, catering companies, and hotels.
Tech growth
It’s often said that Canadian tech startups experience a sweet spot with currency. While they pay their developers, coders, and CAD workers in Canadian dollar salaries, they charge their customers from around the globe in USD.
This gives Canadian startups a better profit margin to grow, hire new workers, and compete against Silicon Valley.
Investment returns
If Canadians own stocks from American companies like Apple or Amazon.com in their retirement portfolio, you might be sitting on a treasure chest. U.S. stocks become more valuable in Canadian dollars when the Loonie is weak.
So even if America’s stock market isn’t moving, their personal net worth could still grow because of the currency.
Trade protection
One major benefit of a lower dollar is that it can offset tariffs. If another country places taxes on our goods, a weaker currency can help level the playing field.
It won’t necessarily make Canadian products cheaper, but it can prevent the price from skyrocketing when trade relations go sour.
Student attraction
Canada has some of the best universities and colleges in the world. A low dollar makes post-secondary education way cheaper than in the U.S. or U.K., attracting students from every corner of the globe.
These students will spend money on groceries, transit, rent, and beer like any other Canadian.
Professional sports
One major benefit of a lower Canadian dollar is that it can help Canadian cities attract international mega-events or keep professional teams playing at the top levels.
Stadium upkeep and local salaries are calculated in Canadian dollars, but broadcasting deals and sponsorship are usually secured in currencies with a higher value, which helps teams’ local budgets.
Farm support
Most major crops, like wheat, soy, or canola, are sold on international markets where prices are listed in U.S. dollars. When farmers bring their earnings home, a lower Canadian dollar means they suddenly have more money than they would have if the exchange was at parity.
They can use that extra cash to pay Canadian bills like equipment repairs, which are paid for in Canadian currency.
Local shopping
Canadians are less likely to hop in the car and cross the border for cheap mall shopping. Instead of spending their money in another country, Canadians are encouraged to support their local malls and independent boutiques.
When Canadians shop locally, they’re keeping the retail dollar in Canada and their downtown cores thriving.
High-value property
Foreign investors have been some of Canada’s greatest allies when it comes to developing Canadian real estate. A lower Canadian dollar can encourage those investors to buy up land for commercial properties and develop infrastructure.
A few examples of this are new condo towers, warehouses for the growing e-commerce industry, and transit infrastructure.
Interest stability
Contrary to popular belief, sometimes a low Canadian dollar allows the Bank of Canada to manipulate interest rates. They can raise Canadian rates, keep them steady, or set them lower than America’s.
Lower interest rates help the average Canadian pay less monthly on their home mortgage, line of credit, or vehicle loan.
National identity
A weak dollar allows Canadian entrepreneurs to dream big and start building local brands.
Instead of importing products from countries like China, they find ways to create their own “made in Canada” alternatives.
The long-term benefit is a happier and more independent Canada.
Sources: Please see here for a complete listing of all sources that were consulted in the preparation of this article.