We’re saying the real story of why the loonie is falling is that it’s Trump’s fault

I thought the best answer for the huge loonie slump was for Canada’s Reserve Bank Governor to tell us why.

He didn’t. He did his best to explain “constraints on the Canadian economy,” that, he said, dole out four to six percentage points in annual growth impact. He said one is unusually low real growth and in another is “uncomfortably low” lending rates. When commenting on the interest rate dilemma, he said he wasn’t considering rate hikes even if you conclude “there is zero hurdle to hiking” rates.

He said one difficulty for the Canadian economy is that the Bank of Canada is forced to govern “in a conservative way and this is a potentially greater challenge today, given the world, given higher commodity prices.”

He described higher commodity prices as, “H2 2018 highs in oil prices” and rising oil prices are “worrisome,” in that they tend to reduce demand on the Canadian economy.

He took no responsibility at all for the downward spiral in the Canadian dollar, but if by chance we’re using his words he would be unable to blame it all on the U.S. Dollar.

Lack of Growth? But the yield curve is flattening? (the chart below shows the yield curve inverted which is usually used as a predictor of recession)

Scoffield told me she prefers to look for reasons for the fall in the loonie.

“We have certainly seen better export data,” she said. “Softer economic data but there could still be something in that number … can we attribute it to commodity prices?”

She’s willing to give everyone a break. She does it herself. When commodity prices were weaker, she probably wasn’t standing on Wall Street to ask “If you’re Canada why is your currency falling?” No one asked her, including those she commends for keeping things in perspective and moving on.

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David Moskowitz is a contributor to the Washington Examiner’s Beltway Confidential blog. He is a Washington correspondent for the Canadian Broadcasting Corporation.

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