TORONTO — The value of the loonie is at a four-month low compared with the U.S. dollar, but experts say Canadian consumers shouldn’t expect their wallets to take a major hit.
As of Wednesday afternoon, the Canadian dollar was trading at 72.46 U.S. cents, the weakest level since early November.
CIBC chief economist Avery Shenfeld says it’s reflective of the U.S. Federal Reserve getting more aggressive on interest rate hikes while the Bank of Canada holds its key rate steady for the first time in a year.
While import cost hikes could lead to higher prices for items like fresh fruits and vegetables, he says the effect on Canada’s inflation rate should be minimal.
The Bank of Canada held its key interest rate at 4.5 per cent Wednesday based on its assessment of recent economic data.
Shenfeld notes the central bank signalled it won’t respond to a modest further weakening of the currency.