Finance, Forex and Investments

How can Central Bank and Federal Government slow down rising looney?

To support exporters, industry and workers in industry, we should do something, what's your idea?: 1-Central Bank Buys American dollar and increases reserves. 2-Federal Gov. Pays back more national debt. 3-Decreasing interest rate. 4-Cutting more taxes. or cutting from corporate tax to support industry and to decrease surplus or all of them

Public Comments

1. Well I'm assuming you're referring to the Canadian central bank here, which wasn't too clear at first. But my response to your question would be that your primary problem is not a rising looney but a depreciating U.S. dollar. Whatever you do to your currency it doesn't matter if the US dollar is falling in relation to all currencies. This depreciation is largely the fault of American monetary policy, i.e the Federal reserve system, something that none of us mere mortals can control. Of course you could buy u.s. dollars but you cant do that forever to buoy the greenback on the markets by artificially increasing demand. Further why would you want to pick up a rapidly devaluing currency? Decreasing your interest rate would help in relation to the value of the looney but at a time of rising commodity prices inflation risks are high. I think cutting taxes and reducing spending is almost always a good idea, helping your exporters stay competitive, however strong domestic economies also drive your currency higher. I think that the Canadians would be wise to start seeking out new markets for their products and services (i.e. Asia, Europe), and also further their production of commodities, as the United States will soon lose their number one spot in the Global economy, and can not be relied upon as your number one market forever.
2. I am in support of all of them.