Every week we bring you the world’s biggest business, currency, and travel news. This week: the loonie improves on its 30th birthday, Interac goes down, gas hits a low, Canadian and US economies grow while the TSX falls, and Bitcoin is accepted at a school.
On Thursday the CAD hit US$0.77 for the first time this year since February, before falling back down to about US$0.768. RIsing oil prices and increasing speculation that the Bank of Canada could raise rates soon are behind the recent surge.
30 years old
The loonie has hit the big 3-0. First introduced in 1987, the loonie has now been in circulation for 30 years. The coin replaced the paper $1 bill to save money and despite first being met with skepticism, the loonie has now become a national icon and synonymous with the CAD. The original design was supposed to feature two men in a canoe, but after a mixup led to the stamps being lost, a new design – a loon – was chosen instead.
Interac E-Transfer Issues
Interac E-Transfer is currently experiencing technical difficulties, leading to issues for Canadian bank users trying to use the service. Interac said the problem was resolved Thursday, however CBC reports that they are still having problems.
7-year low gas prices
Despite a more optimistic outlook for oil prices, gas this long weekend is at a 7 year low at about $1.04 per litre, 14 cents lower than the average over the last ten years, and the lowest since 2010.
Canadian economy expands
The Canadian economy grew by 0.2% in April despite oil and gas shrinking by about 0.8% due to a shutdown of the Syncrude oil sands facility. Manufacturing also fell by 0.9% but the arts and entertainment sector exploded with 7% growth. According Brian DePratto, an economist speaking to the CBC, “at least part of the gain can be attributed to five Canadian teams making the NHL playoffs this year.” In the year ending in April the Canadian economy has grown 3.3%. The figures are the best of any industrialised country, and could help convince the Bank of Canada to raise rates.
TSX fell on Thursday
As talk of the Bank of Canada possibly increasing rates in the near future gained traction thanks to boosted economic performance, the TSX took a hit. Higher rates mean a stronger currency (hence the loonie’s recent rise) but also makes borrowing more expensive.
US economy exceeds expectations
The US economy grew at an annualised rate of 1.4% in Q1, more than originally thought. Despite the good news, the growth rate is still well below the 2.1% at the end of last year. Yearly growth is expected to fall to 2.2%, well below President Trump’s promised 3% target.
Bitcoin Accepted at US School
A Montessori school owner in New York is refusing to accept credit cards, but will take Bitcoin. Universities in London and Greece will soon also accept the cryptocurrency. Bitcoin’s value has more than doubled this year.
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