What is the Canadian Dollar?
The Canadian Dollar is the official currency of Canada. It is also sometimes informally referred to by traders as the “Loonie”. The name is in reference to the country’s indigenous bird, the common loon.
Canada’s first bank notes were introduced in 1817. The Canadian Pound[1] was adopted in 1841, though it was never linked to the namesake British currency. In 1854, Canada introduced the gold[2] standard. However, conversion to gold was suspended during WWI and fully discontinued in 1933.
In 1949, the Canadian Pound was supplanted by the Canadian Dollar. The following year, it became a free-floating currency until 1962, when a fixed exchange rate was introduced. It was liberated anew in 1970 and has remained so since.
In 1987, the Canadian one-dollar coin was introduced that bore an image of the common loon. It was nicknamed the “Loonie” and has come to be synonymous with the Canadian Dollar.
History of the Bank of Canada
In 1933, Prime Minister R.B. Bennet founded the Royal Commission on Banking and Currency. It later drew up a proposal to establish a central bank in Canada. Prior to the establishment of the Bank of Canada (BOC), the country’s biggest bank was the Bank of Montreal. It acted as a banker to the government while the Department of Finance was responsible for printing Canadian banknotes.
The BOC was chartered in 1934 under the Bank of Canada Act and was established as a privately owned corporation in order to ensure political indifference. In 1938, the bank was designated by Prime Minister Willian Lyon Mackenzie King as a federal Crown corporation.
The BOC was tasked
