With the price of a barrel of oil taking a nose dive, so too has the Canadian dollar. For the last 2 months, the business reporters keep saying the “new lower dollar” is good for exporters. They always talk about exporters of steel, cars, hard goods, etc.. but they never talk about the “software exporters” which of course Capitalware is one of. Capitalware sells its software in US dollars, so when the Canadian dollar was above par (to the US dollar), I hated to go to the bank and do foreign exchange because I would get less Canadian dollars than US dollars (enough to make you cry).
I haven’t transferred any money (US to CAD) in a while and have been getting nervous thinking when it would be a good time. I always transfer at least $50,000 because the Bank of Montreal gives me a better exchange rate when I do (a secret I found out about a few years ago).
So, why is today a wonderful day, well, the Bank of Canada decided this morning to lower its interest rate to 0.75% (from 1.0%). This put the Canadian dollar into a nose dive of almost 2 cents. The Canadian dollar is now trading at 0.8095. (i.e. 1 CAN dollar buys 0.8095 US dollar).
I went to the Bank of Montreal early this afternoon and transfer almost every penny I had from US dollars to Canadian dollars and received an exchange rate of 1.2225. (i.e. 1 US dollar converted to $1.2225 CAN). OMG. Seriously. OMG. I haven’t gotten an exchange rate of 1.2225 in almost 10 years (although there was a brief period in early 2009, when the Canadian dollar took a dive).
Most people may think so what! Capitalware is a small company so every penny counts. Here’s a table of transferring $100,000 US dollars to Canadian dollars in all its pain and/or glory.
1 US -> CAN
|Canadian Dollars Received
The difference in exchange from 2 months ago to today is mind blowing. This isn’t a few dollars, it is thousands of dollars. Like I said, it is a WONDERFUL day today.
Of course, there is a downside. If any Canadian is planning on taking a USA vacation in the near future, things just got a whole lot more expensive!!