But problems are not only internal, the deceleration recorded in the latest months all around the world (and specially in its main trade partner: USA), maintains its trade balance far from normal pre-crisis levels. Main exports of Canadian economy are medium to high value added industrial products and commodities (specially energetic natural resources).
Public finances are not worrying neither comfortable: public debt to GDP is high (87,4%) but federal budget to GDP is near equilibrium (-0,2% in 2011, recovering from -1,7% in 2010 but far from pre-crisis levels above +3,%). Monetary policy has kept stable since the end of 2010 with its benchmark rate at 1,00%, prices are decelerating (current CPI yoy rate is 1,3%) and unemployment has decreased to 7,27% (in the middle between 2007-2008 levels at 6,0% and 2009 highs at 8,50%) though we can see some stabilization in recent months.
Economic perspectives hinges on internal consumption (that has slowed and needs the unemployment rate to keep on falling further) and on the return to higher growth levels of its main trade partners: USA, Japan and Mexico.
Its currency moves highly synchronized with commodities prices, so CAD keeps an appreciation long term trend against USD that reached 0,90 CAD/USD level at the end of 2007. Lehman´s bankruptcy and world trade collapsed during the last quarter of 2008 caused a strong depreciation till reaching levels of 1,30 CAD/USD. When global economy calmed again, CAD restored its long term appreciation and its currently under parity against USD.
In a short term point of view we can observe that QE3 expectations initiated at the beginning of the summer of 2012, pushed again CAD, breaking down support levels at 0,98 CAD/USD. After QE3´s confirmation there is still room to reach relative lows at 0,94 CAD/USD (july 2011), though it will have to break down the very long term upward trendline that is around 0,953 CAD/USD. The trigger for this movement could be a strong and firm political movement in the Eurozone that restores investors confidence about a definitive solution of European periphery debt problems that can reduce global growth downside uncertainties.