EURCAD

Live and Historical EUR/CAD Rates

This chart represents the value of the Euro against the Canadian Dollar – the number of Canadian dollars required to buy one Euro. Both are considered major currencies, though the pair is not. The pair has remained relatively stable and volume is also relatively low.

The Euro

Twenty-one European countries have adopted the Euro as their currency since 1999. After the US dollar, the Euro is the second most traded currency. The Euro boasts the highest circulation volume of economic value out of any world currency. The Euro is also the second largest reserve currency. The European Central Bank (ECB) in Frankfurt controls the Euro, but the ECB has generally allowed the market to determine the value of the currency.  Exports, services, agriculture, and tourism have the greatest influence on the Euro.

The Canadian Dollar

Canada has the tenth largest economy in the world. The Canadian dollar (CAD) ranks seventh in most traded currencies. In 1871, the CAD unified the various Canadian currencies.  After abandoning the gold standard for the last time in 1933, Canada went back and forth between pegging its currency to the US dollar and allowing it to float. Since 1970, the CAD has floated, and the Bank of Canada (BoC) has not interfered with the Canadian dollar since 1988. The Canadian dollar is now a benchmark currency, with oil being the major influencing factor in the CAD’s value.

EURCAD Analysis

Canada’s financial relationship with the European Union is complex. Canada is under the dominion of the monarch of Great Britain, which is part of the EU but has not accepted the Euro. However, Canada’s economy is more directly tied to its southern neighbor, the United States, than to Great Britain or the Eurozone. Almost 85% of Canadian exports go to the US, and over 50% of Canadian imports come from the US. As Canada’s economy is largely dependent on commodities like oil and lumber, while the Eurozone depends more on services and manufactured goods, the EUR/CAD has been a popular, but not a major, trading pair. Therefore, the greatest influences on the pair are the US economy, commodity prices, and any changes in the Eurozone. The EUR/CAD is not generally used for carry trades.