Canadian Bank Exchange Rates Comparison
The table below is a comparison of all the major Canadian bank exchange rates. The rates have been sourced from their website or by calling their branch on a given day. Please note, exchange rates change frequently.
Some of the banks require you to call them to see their rates because they change a lot. Most of the Canadian bank exchange rates compare generally within each other in terms of exchange rates. However, most Canadian banks charge a substantial mark-up.
|Royal Bank of Canada (RBC)||2.6%||RBC Exchange Rates|
|TD Bank||2.6%||TD Exchange Rates|
|Scotia Bank||2.8%||Scotia Bank Exchange Rates|
|Bank of Montreal (BMO)||2.6%||BMO Exchange Rates|
|CIBC||3.3%||CIBC Exchange Rates|
|Desjardins||2.5%||Desjardins Exchange Rates|
|HSBC||2.1%||HSBC Exchange Rates|
|Knightsbridge FX||0.1%-0.5%||KnightsbridgeFX - 416-479-0834
Essentially, the table above shows that banks charge more for currency exchange when buying or selling US dollars. I'm sure you are not surprised. If you multiply the difference in the exchange rates between the banks and a currency exchange provider by the amount of your transaction, then this is the estimated savings. Simply check the rate to buy US$1,000 with your bank and with a currency exchange provider and you will see the net savings to you. At this point, you can determine if its worth it to use your bank or not. For larger amounts, the savings become greater and it makes more sense. For small amounts of currency, simply use your bank.
It is important to remember that exchange rates fluctuate in real time and are constantly changing based on market events.
The Best Place To Buy or Sell US Dollars in Toronto
Large Currency Exchange Above US$5,000
- Call Knightsbridge Foreign Exchange at 416-479-0834 or 1-877-355-5239
If you do not need physical cash currency in dollar bills (for example, you have a US dollar account and can accept US dollar funds in your bank account or need funds sent to the USA) and need to buy or sell US dollars in amounts of $5,000 or more, give Toronto based Knightsbridge Foreign Exchange a call at 416-479-0834 or visit their website at www.knightsbridgefx.com. In a comparison (see above), they have easily beat the currency exchange rate of Toronto banks and others.
This will give you the best exchange rate and will save you the most amount of money. The savings estimate is 2%+ compared to your bank's currency exchange rate. They call the banks every morning and then ensure their exchange rates are better. Everything can be exchanged within a day. The larger your transaction, the better the exchange rate you will receive. You can get a no-obligation currency exchange quote by calling 416-479-0834 or 1-877-355-5239.
Cash Exchange and Amount Under $5,000 for US dollars, Euro's and British Pounds
There are a number of places to exchange cash currency in Toronto. If you require physical cash currency, then you will need to find a place that handles physical cash exchange. Physical cash exchange is way more expensive than electronic cash exchange, so try to buy in larger amounts to take advantage of better exchange rates. If you need physical cash, you can find a few places close to you here.
You can also visit TD Toronto foreign exchange services is located in downtown Toronto and has physical cash for you to buy. They carry over 50 currencies in stock and ready to sell. You can also get this ordered to your closest branch. It is a very convenient option for currency exchange in Toronto.
You simply walk up to the counter and exchange your currency. You can also give them a call ahead of time to see if they have your currency on hand. However, the exchange rate at TD is a "cash rate" and this has a markup, which can be up to 2% or even more. If you want to save money, you can open a US dollar account with your bank (takes 15 minutes if you already have a Canadian account) and buy in increments of US$5,000 from KnightsbridgeFX. Once the funds are in your US dollar account at your bank, you can simply go to your branch and withdraw the funds in US dollar cash.
Currency Exchange Real Time Market Rates
Looking for the best currency exchange rates in Toronto that provide better than bank exchange rates? Call Knightsbridge Foreign Exchange Toronto (www.knightsbridgefx.com) at 416-479-0834 for a no-obligation currency exchange quote.
You can see real time currency exchange rates above. The first row shows the market US dollar Canadian dollar currency exchange rate. It also shows the high and the low for the US dollar exchange rate for the day. Currency exchange rates are volatile and change every few seconds. If you are looking for the best place to exchange US dollars, you can definitely do a lot better than your bank if you have a sizeable amount to convert.
In Toronto, there are a few places where you can exchange currency. If you are looking for physical cash, then you need to go to a retail outlet or a bank. If you are looking for a large amount of currency, for example, over $5,000, then you should avoid the banks because the charge high fees. All you need to have is a Canadian or a US account as transfers are done bank to bank.
Toronto Currency Exchange Places
There are a number of currency exchange places in Toronto and many of them are located in the mall. These places cater more to tourists and often don't have the greatest exchange rates. They deal in small amounts of physical cash and focus more on convenience than rates. If you are converting a large amount, a retail place is not necessarily your best option in Toronto. If you need physical cash, you can find a few places close to you here.
Smaller cash outlets offer convenience but have high rent and fixed overhead costs. If you need physical cash, then you pretty much have to go to these places and you don't have much of a choice.
However, if you are in Toronto, and need to convert a large amount of Canadian dollars or US dollars, then consider KnightsbridgeFX.
Currency Exchange Tips For Beginners
- No airports. If you are buying physical cash, do not buy it at the airport. Airport rent is expensive and so are the markups at the airport on currency exchange.
- Ask them to lock in a rate for you. A currency exchange company should be willing to lock in a rate for you so you know the price you are willing to pay and how much currency you will get. You should get written confirmation before you proceed otherwise you might find that the rate changes for you when you are in the store. Reputable places will provide you written confirmation in advance.
- No service charges and commission. Ask them what the service charges and commissions are before you go to the place to buy currency. Tell them to waive all currency exchange service charges or commissions.
When is the Best Time to Exchange Money?
I wish I could tell you. There is no perfect time of day or of week to exchange funds. The currency exchange market is very efficient. If there was a perfect time of day then everyone would wait all day for this time and the rush of people buying at that time would push the price up.
The currency exchange market is based on a lot of factors, especially supply and demand and economic factors.
However, currency exchange rates typically all rise on the weekend due to lack of liquidity (supply). Therefore, if you go to exchange currency, try not to do it on the weekend as markets are generally closed and currency exchange companies have to hold on to the currency over the weekend and take on risk that the currency exchange rates change against them.
How to Ensure You Are Getting a Better Exchange Rate than Your Bank?
The process is simple but takes some work. Call your bank and ask them what it costs to buy US$1,000. Call a currency exchange company and ask what it costs to buy US$1,000. Now you know the cost for both places. Make sure your currency exchange company is cheaper than the bank! Don't forget to ask about any fees or commissions.
Currency Exchange for First Time Users
So you finally need to buy US dollars for the first time. Most likely, you are buying US real estate, a car, or a boat, and you need to exchange Canadian dollars in to US dollars.
- The first thing you need to know about using a currency exchange company is you will need to register with them. Registering is free, but it requires you to fill out a form (typically very short). The reason this is required is that the Government of Canada regulates the money exchange industry and all companies that exchange currency are required to validate the identity of customers. You can learn more about this with FINTAC (http://www.fintrac-canafe.gc.ca/msb-esm/id/when-quand-eng.asp)
- Do not use any company that does not require you to validate your identity.
- Since you are not doing anything wrong, filling out a form should not be a problem. It also ensures you are working with a company in good standing with the law and is following all currency exchange practices in Canada.
Choosing a company
- You can look at the Yellow Pages or Google to find a currency exchange company. You want to ensure they are registered with the BBB. You also want to see if they have a media presence as only good companies get coverage with the media.
- If you need to purchase currency by a certain date, it is good practice to do it one day in advance. This will give you additional time incase you need it. Most currency exchange companies can do same day transfers but keep one day grace for yourself.
Questions to Ask a Currency Exchange Company
Here are some questions to ask a currency exchange company
- Lock in an exchange rate. Ask if a currency exchange company will lock in a rate for you AND if they will provide you written confirmation of the rate before you send funds. This is important so the rate does not change on you. Reputable companies will gladly provide you written confirmation of the exchange rate so you know exactly how much you are sending and how much you are getting in return.
- Are they registered with the Better Business Bureau? Currency exchange companies that are registered with the BBB have a good way of handling third party complaints and have a better reason to protect their reputation.
- Are they 100% Canadian owned and operated? You want to make sure you are working with a 100% Canadian currency exchange company. You will feel better to know your company is based in Toronto rather than some other part of the world. Canadian companies work with Canadian banks.
- Are they registered with FINTRAC? All money exchange companies in Canada must be registered with FINTRAC. There are no circumstances in which you should work with a money exchange company if they are not registered with FINTRAC.
This is a good starting point list of questions you can ask a currency exchange company based in Toronto.
Which Bank has the Best Exchange Rate in Toronto?
If you live in Toronto, you will have access to all of the major big five Canadian banks for currency exchange. The marketshare of the Canadian banks is fairly split between all of them so you should have a branch that is close by to you. However, when it comes to currency exchange, some banks are better than others.
If you frequently need to exchange currency, you want to align yourself with a bank that offers the best exchange rates to buy us dollars. Now most banks have fairly high markups, so if you really want to cut down on exchange rate costs, then you want to use a foreign exchange provider such as KnightsbridgeFX. That being said, if you want to stick to using your bank, then the bank that offers the best exchange rate is HSBC bank.
This could be because they are an international bank or that they prefer to work with clients that have international exposure and therefore international currency exchange needs. Most likely, it is because they are less greedy than the other Canadian banks.
HSBC offers better buy and sell rates on US dollars than the other major Canadian banks. The problem with HSBC is there aren’t as many branches in Toronto of HSBC as some of the other big banks.
RBC, BMO, and TD also offer fairly close currency exchange rates for US dollars. Their rates are slightly higher than HSBC but if you are only buying small amounts of currency, then you are not actually paying too much more for the convenience of a close location and branch.
TD borderless exchange rates are better than the standard TD rates, so if you do a lot of cross border shopping, you may want to consider having a TD cross border account. For example, the difference between a regular TD rate and TD borderless is 0.7% cheaper, but it still has a currency exchange spread of above 2% or so.
TD has branches in Canada and the USA and TD is becoming a choice for many Canadians that frequent the US. However, BMO has HARRIS BANK in the USA and RBC also has RBC USA (although they recently got out of some parts of the USA).
How to Open a US Dollar Account in Canada for Currency Exchange if You Don’ Have One?
If you have decided you need to purchase a large sum of US dollars but you don’t want a cheque or draft in US dollars, you need to open a US dollar bank account.
This is easy to do nowadays.
Simply go to any of the big five banks or the current financial institution that you work with and tell them you want to open a US dollar account.
You will need one or two pieces of ID and you may need to deposit $1 in the account.
You will need to fill out some paperwork but it shouldn’t take more than 15 to 30 minutes to open a US dollar account.
- RBC Cross Border Banking: http://www.rbcbank.com/banking-in-the-us/cross-border-solutions/index.html
- TD Cross Border Banking: http://www.tdcanadatrust.com/products-services/banking/cross-border-banking/
- BMO Cross Border Banking: http://www.bmo.com/home/personal/banking/bank-accounts/us-dollar
Switching Banks for Currency Exchange
The answer is yes and no, well actually it depends. It depends on the amount you are transacting. If you transact a lot, such as you get paid in US dollars and you need to frequently convert it to Canadian dollars, then you want to consider using a bank that is going to give you the best exchange rates out of all the Canadian banks.
The problem with switching banks is convenience and hassle. A good general rule of thumb is that if you have recurring requirements then you want to try to minimize your foreign exchange costs and it is worth it to switch to banks that have the best exchange rates because you will save on a recurring basis.
If you do not have frequent currency exchange requirements, then it might not make sense to switch. There is hassle and paperwork involved plus regular fees. Also if your dollar amount is large, then you will save more by switching. If your dollar amount is less, then the savings won’t be that much.
A good rule of thumb is $10,000 annually. If you transact more than that, then you want to get the best exchange rates. Anything less than that and the savings might not be worth the hassle.
Lastly, banks are still quite expensive for currency exchange so you may want to consider a currency exchange company in Toronto that will allow you to save even more money with better than bank exchange rates AND will still allow you to keep your existing banking relationship. Banks have all the marketshare so why should they give away currency exchange for free, they can practically charge whatever they want and get away with it.
Most will allow you to do this so this is something you should consider if you are transacting a large amount.
How to do Physical Cash Currency Exchange at Each Bank
Almost all of the major big five banks will offer currency exchange at the branch level, mainly for US dollars. For other currencies you need to contact your branch so they can order it for you.
TD has a specialized foreign exchange centre in downtown Toronto (near the TD tower located at 55 King St. West, Toronto, ON) and they focus exclusively on currency exchange and precious metals.
You can give them a call at (416) 216-6868 to see if they have your currency in stock and how much they charge for it. This is not a bad idea if you must have physical cash currency. If you are buying USD of $5,000 or more, there are better options for you.
The process for physical cash exchange is at a TD foreign exchange centre is as follows:
- Call TD at (416) 216-6868 and see if they have your currency
- Find out their exchange rate
- Tell them you are coming in to they can put the money aside for you (get a name of a TD representative so when you walk in you can speak to them directly)
- Ask them if you can give them physical cash or a cheque or a draft
- Their hours are Monday to Friday 8am to 6pm EST.
- You will likely need to show a piece of ID for regulatory purposes.
- If you have a small amount of foreign currency to buy, then TD is a really good option even if their rates are not the absolute best. The reason is that TD is safe and will give you “good money” and you know where they are located, when they are open. The excess cost you pay to TD to buy foreign currency on a small dollar amount can be really small. Like if you need 100 Euros and TD is more expensive by 1% than another place, the savings is only $1 to go somewhere else so it’s not even worth it to go look anywhere else. If you are buying 10,000 Euros, then you want to call around to see the savings.
Physical Cash Currency Exchange Requirements
Exchanging physical cash is more expensive than exchanging currency electronically. This is because the place you are exchanging it with has to carry inventory and has higher overhead costs such as rent.
You will also need to provide ID when you exchange physical cash and explain where you got the money from and what you want to do with the currency. Make sure you are going to a reputable place to exchange currency.
Steps for Ordering Currency at the Bank
The step by step instructions to ordering physical cash at your bank is as follows.
- Call your branch and make sure you are not speaking to a call centre in Philippines or India. Get transferred to your local branch!
- Tell them how much foreign currency you need and when you need it by. Ask if they can order it in by then.
- Get a sample of their rates and compare it to online rates.
- Take down the name of the person you spoke to and order it. They might ask you to pick it up from another branch.
- Pick up the currency.
- You will likely need to show a piece of ID.
Canadian Bank Currency Exchange Forecast 2015 and 2016
As you can see, the Canadian banks are all over the place when it comes to the Canadian dollar forecast. Some are forecasting the Canadian dollar to go higher, while others are forecasting the Canadian dollar to go lower.
|Bank Currency Forecast||2015 USD/CAD||2016 USD/CAD|
* Updated February 7, 2015
Most of the banks provide a Canadian dollar currency exchange forecast. However, take it with a grain of salt as they can be right just as often as they are wrong.
Why the banks charge so much for currency exchange in Toronto?
If you have contacted your bank for currency exchange in Toronto, you have probably realized that the bank exchange rates are terrible. Currency exchange places are better, but why? The first reason is that banks essentially have a monopoly (oligopoly) in the currency exchange market. Your money is already at the bank and they know this. You probably only bank with one or two banks. Therefore, what is the chance that you will even consider not using your bank for currency exchange? Probably more than 90% of people use the bank and most consumers will simply accept the exchange rate their bank provides them. Therefore, the banks don't really compete on price. In fact, if they increase their prices on exchange rates, consumers will likely still accept them. Secondly, the banks have high overhead costs and don't specialize in only foreign exchange. Bank processing costs are high, they go through several people, and the branches have high overhead.
The margins that the banks charge for currency exchange is very high, and this is the main reason currency exchange places can undercut the bank exchange rates - because their rates are so high!
Getting the Best Rates for Currency Exchange in Toronto
Individuals that need to convert currency should look for the best exchange rate in Toronto before they convert any funds. Currency is a commodity and there are a number of places that sell currency including the Canadian banks. Each service provider that sells currency is looking to sell it at a price that they can make a profit on, but some providers have higher costs than others.
Think of a large bank that has high overhead costs such as branches, advertising, and staff. These costs add up and banks need to add a substantial markup to ensure they are making money to cover these costs.
Many smaller and more nimble and specialized providers can deliver the same currency at a lower cost because they have much lower overhead. Secondly, banks have a large share of the market, with most Canadians using banks than non-bank providers to exchange currency. Therefore, why should Canadian banks provide the best exchange rates in Toronto if they know that most of their customers will exchange currency through them regardless of the price or mark-up they charge on currency exchange. Therefore, the banks will typically not provide the best exchange rates in Toronto.
The best exchange rates in Toronto are more likely to come from a non-bank provider. One such provider that provides the best exchange rates in Toronto is Knightsbridge Foreign Exchange (www.knightsbridgefx.com), you can get their exchange rates by calling 416-479-0834 and obtain a no-obligation quote. Compare the quote to your bank and you will be able to see if they have better exchange rates than the bank. They can even help you compare their rate to your bank rate and see how it compares. You will save money because banks have a higher mark-up.
How to Save on Foreign Exchange Rates When Travelling?
As Canadians travel throughout the world, when they travel, they need to purchase currency of the local markets they travel. Exchanging cash at hotels and malls in local tourist markets is convenient but can be very expensive. The markup can be substantial at some of these places.
A credit card can charge a markup about 2.5% on top of the middle market exchange rate. This is reasonable but is also costly. However, it is convenient.
Before you exchange currency cash at a local outlet, compare the exchange rate you are getting with the interbank exchange rate and if the markup is a lot, then find another place. If the markups you are finding is greater than 2.5%, then you might want to just use your credit card to exchange currency.
You can also try to negotiate with different places to see if they can give you a deal. Knowledge is power.
Why Can't I Get The Bank of Canada Exchange Rate?
The Bank of Canada exchange rate is typically an interbank rate only available to financial institutions with large volumes (several millions of dollars). Canadian banks add a substantial markup to the exchange rate they offer to retail customers and that is how they make money for delivering the service.
This markup can be 2% to 5% depending on the currency. Banks have to pay for holding the cash and keeping the currency on hand. The tellers need to be paid and also rent has to be paid for space. That being said, the exchange rate markups they charge are quite high compared to other foreign exchange providers. The reason bank exchange rates are so high is because regardless of the markup, Canadians will continue to use the banks to exchange money.
There is no competitive pressure for the banks to reduce exchange rate fees. The same goes for currency kiosks at the airport, they have to pay for rent, and they offer a convenient service, and most people at that time pretty much need to convert currency to use it, so they will be willing to pay markups to exchange money there for convenience.
Therefore, do not expect to receive the Bank of Canada exchange rate when you convert your currency. However, you should get a better rate than the banks if you are transacting over $5,000 with a currency exchange provider.
How to Compare Exchange Rates?
The best way to compare currency exchange rates is to use the table above or call each bank directly.
Simply ask them if you wanted to buy US $1,000, how much in Canadian would you have to pay?
This will give you the amount in Canadian dollars. Divide the number of Canadian dollars needed to purchase $1,000 and this will give you the implied exchange rate.
Call up your bank and a currency exchange place and see which one offers a better rate. Go with the cheaper option.
Reasons You Should Use Your Bank to Exchange Currency
1. Convenience. If you are exchanging a small amount of currency, say $100 from Canadian to US dollars. The benefit of using a bank is convenience. The markup at the bank will be high, let's say 2-5%. However, the markup fee that the bank charges you only amounts to a couple of dollars in fees, such as $2 to $5. So for a small amount of savings, it doesn't make sense to use anyone other than your bank.
2. Location. Banks have many locations and if you need a small amount of currency then its easy to just go to your local branch and pickup some cash if they have it on hand. Just call them in advance.
3. No running around. If you use a currency exchange provider and if you need physical cash, then you will have to first go to your bank and get Canadian dollars. Then you go to the provider and give them Canadian and get US dollars. This is a lot of running around. If you don't have a large amount to exchange, simply use your bank and save your time.
Reasons You Should Not Use Your Bank to Exchange Currency
1. Savings. Did you look at the chart at the beginning? Did you see the outrageous rates that the banks provide? If so, why are you thinking of throwing your hard earned money away and exchanging currency at the banks? Use a currency exchange company and save money. The savings will be about 1% to 2%. On amounts of $10,000, this can be several hundreds of dollars. Spend this savings on yourself or your family, don't just give it away to the banks.
How to Choose a Foreign Currency Exchange Company in Toronto
In choosing a foreign exchange company, there are several things to consider. Firstly, this will assume you want to buy US dollars and a large amount of US dollars. For small amounts, just use your bank for currency exchange.
Here are some questions to ask:
Are they Canadian owned currency exchange company?
It’s important you deal with a Canadian company. That is not to say non-Canadian companies are not good, but Canadian companies will use Canadian banks and will have employees in Canada.
Get a sample of their currency exchange rates
Call them and tell them you want to buy US$10,000 and get a sample of their exchange rates.
Then ask them that you want to know the currency exchange rate for US$100,000 and ask if it will be a better rate. This is important because you should get a better rate for a larger dollar amount.
Ask if they will offer you a free wire transfer to the USA.
A lot of companies will charge you $15 for a wire transfer. Ask them to waive this fee. Most currency exchange companies will give you a free wire transfer if you ask.
Ask if you can transact electronically with them.
Some places will make you first call in for a rate, then make you go to your bank, get a draft or cash, then go to the currency exchange place, get a draft in return, go back to your bank and deposit it. This could take half of your day!!! Your bank may put this draft on hold and this could be for 3 to 5 business days. This is a lot of running around. Also, from the time you call the place, the rate might have changed so if you need a specific amount of currency, then this could throw things off.
Imagine if you need US$10,000, they tell you it will cost $10,700 Canadian, you get a draft and at their location they tell you they need $10,800 Canadian and show you an in-house ATM. This is not good and because you have made a draft to the company name there is nothing you can do and they know it.
The new trend in currency exchange is transacting electronically by bank transfer, either online bill payment or wire transfer. Essentially, you register with a company for regulatory purposes (Government requirement). You call the foreign exchange company to book an exchange rate. If you like it, they will lock it in for you and send you a receipt confirming the rate. It is important you get a recipient confirming the rate so you know exactly how much to send and how much you will get. You then go to your bank and transfer Canadian dollars to their trust account and they will send US dollars back to your USD account or directly to the USA for you. The good thing about this is your rate is locked in initially before you send funds, you only go to your bank to transfer funds and there is no hold on the funds as bank transfers are cleared immediately.
Credit Card Exchange Rates
Most credit card companies will charge a fee to exchange currency. The fee is built in to the exchange rate. The fee's are outlined in the terms and conditions of the credit card agreement. Many believe that this credit card markup is about 2.5%. Using your credit card to pay for something in a foreign currency is convenient, but you do end up paying a markup to use your credit card. Often, there are few alternatives, so there is not much you can do.
Watch the Exchange Rate Service
If you have a bit of time before you need to buy US dollars, then you can watch the currency exchange rate to see if it moves in your favor. You can ask Knightsbridge Foreign Exchange to do this for you as well. Simply call them, ask them that you want to buy a certain currency if it reaches a certain rate and they will watch the exchange rate for you and convert it for you if it reaches your desired level.
The benefit of the rate watch service is that you can get them to watch the exchange rates for you without you having to waste time watching the rate. They watch the exchange rate regularly so might as well ask them to watch it for you instead of you having to waste time doing it yourself.
If you have some time before you need to exchange funds and believe you have a certain point at which you want to exchange currency, then this service may be useful for you.
However, it is important to note that, if the currency does not move in your favor and does not reach your desired level, the currency will not be bought. The currency may not always move in the direction you want it to go.
Factors impacting the Canadian Dollar Currency Exchange Rate
So far in 2014, the Canadian dollar exchange rate has been rangebound. It has been rangebound around the 1.10 USD/CAD exchange level. Pretty much moving about 1-2% around this exchange rate. The Canadian dollar seems quite content where it is and does not seem to be moving around too much.
The main factor that could be driving the change in the currency in the future is the economic performance of Canada vs. the US. A stronger economy could lead to a stronger currency. Right now, jobs data, GDP data, and inflation data are things to look at as factors that can influence the Canadian dollar and the US dollar.
The Canadian dollar can be volatile or range bound and there are a number of factors that influence the loonie. The Canadian dollar has been significantly below parity vs. the US dollar many years ago and recently has been above parity over the last few years at times. Some of the factors that the Canadian dollar is correlated to are the following:
- Oil prices: The Canadian dollar is often called a petro currency. This is because the Canadian economy has a lot of oil and gas services. As oil prices move up, the Canadian dollar also moves higher at times.
- Commodities: Similar to oil, Canada is filled with lots of natural resources. As commodity prices go up, the Canadian dollar can also move higher.
- Stock Market: The Canadian dollar has recently been moving in the same direction as the stock market and is often called a risk-on currency. As investors take on more risk and invest in the stock market, the Canadian dollar also rises directionally at times. During a recession, the US dollar does well and rises.
- Interest Rates: When the Bank of Canada raises interest rates, more money moves in to Canada as interest rates are higher. This attracts flows of funds to the Canadian dollar. Therefore, at times, when interest rates rise, the Canadian dollar can do well directionally.
Note, these are only some factors that can influence the Canadian dollar and these factors can change at any time. History is not always a predictor of the future.
Currency Exchange - History
The Canadian dollar is often known as the loonie and is often symbolized as "CAD" or "C$". The central bank that overseas the printing of the Canadian dollar is the Bank of Canada. Canadian dollar coins are produced by the Royal Canadian Mint. The Canadian dollar has switched from a fixed system to a floating system and back to a fixed system and now to a floating system.
The Canadian dollar history compared to the US dollar has been at both a premium and a discount to the US dollar. For over 30 years, the US dollar was more stronger than the Canadian dollar until 2007. Since then, the Canadian dollar has traded above and below parity, which means 1 USD = 1 CAD.
When is a not a good time to exchange currency?
The only time it is not good to exchange currency is on the weekend as the markets are closed and the markups can be higher at all places including banks.
What does currency exchange spread mean?
The spread for currency exchange is the difference between the buy and sell rates or the difference between the mid-market rate and the buy or sell rate. The smaller the number the better.
Benefits and Pitfalls of Exchanging Currency with Online Currency Exchange Companies
In the beginning the banks were the main places to exchange currency. However, since they charge so much for currency exchange, currency exchange houses started to pop up. They were cheaper than the banks.
Nowadays, online currency exchange companies have lower fixed overhead (less rent) and can use technology as an enabler to reduce costs. The main benefit of online currency exchange companies is that they are cheaper.
Obviously, you need to do your research on these companies and see if they are part of the BBB and if others have used them. You want to give them a call to learn more about them and once you call them, you will get a better sense of how you feel about working with them.
Looking for Currency Exchange Outside of Toronto, see other currency exchange locations:
Resources: Canadian Bank Exchange Rates Comparison | Why Can't I Get The Bank of Canada Exchange Rate? | How to Compare Exchange Rates? | Currency Exchange - History | Currency Exchange Toronto Best Rates | Compare FX Rates | Toronto Rates | How to transfer currency to the USA | Currency Exchange Recommendations in Toronto
Currency Exchange Resources
Bank Exchange Rates
Canadian Dollar Forecast