The leaping loonie could derail Canada's economic recovery, Prime Minister Stephen Harper warned yesterday.
As the Canadian dollar climbed toward parity with the U. S. greenback, Harper echoed Bank of Canada Gov. Mark Carney's caution that the upward swing could drag back the financial turnaround.
Despite recent good news on national employment figures, he said Canada's economy remains extremely fragile.
"We're not out of the woods. There are many risks -- some of them within our control, some beyond our control," Harper said during a funding announcement in Vancouver. "Obviously the value of the Canadian dollar is a risk to recovery. I don't think it's a risk to choking off the recovery, but if it goes up too rapidly it does have difficult effects on our economy."
Jeff Brownlee, vice-president of public affairs for the Canadian Manufacturers and Exporters, said the soaring dollar is wreaking havoc with industries already grappling with razor-thin profit margins.
The association estimates that every one-cent hike in the value of the Canadian dollar cuts manufacturing sales by an estimated $2 billion. That means every one-cent rise means about 25,000 job losses....
SOURCE: KATHLEEN HARRIS, SUN MEDIA
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