Canada-related exchange traded fund (ETFs) are experiencing an uptick in activity as the economy expands on growing global demand.
Canada’s economy grew 3.3% in the fourth quarter as increased exports, higher global demand for industrial metals and crude oil, consumer spending and stable inflation have helped pushed the economy along, writes Greg Holden for ForexYard. [Canada ETFs: An Indirect Commodity Play.]
Additionally, higher oil prices have fueled the rise in the Canadian dollar, or “Loonie” – the USD/CAD pushed below its 23.6% Fibonacci level, a low last seen in Feb. 2008. The Loonie is also stable pricing against the Japanese yen and the Swiss franc.
Still, a few economists are concerned that Canadian exports will experience challenges brought on by currency growth and weaker output in industrial production. If the currency growth rate persists, exports could be dampened over the next two quarters.