CAD to USD - Convert Canadian Dollar to US Dollar

What is Currency Exchange?

Currency exchange is the process of converting one currency into another at a specific rate. In today's global economy, people and businesses regularly exchange currencies to trade, travel and invest internationally.

At its core, currency exchange involves trading one currency for another at live market rates. For example, converting US Dollars (USD) to CAD (Canadian Dollar) or JPY (Japanese Yen) to EUR (Euro). These transactions occur through:

• Banks and financial institutions
• Currency exchange offices
• Online forex brokers
• Digital payment platforms

When converting currencies, it's important to monitor live exchange rates, compare conversion fees, use reliable exchange services, consider timing for better rates and understand currency market trends.

The market rate and the customer rate – what’s the difference?

The market rate is the wholesale exchange rate used between banks and large financial institutions when trading significant volumes of currency. This rate represents the exchange rate without any markup or fees. However, individual customers and smaller traders rarely have access to these favorable rates.

The customer rate includes a markup above the market rate, which represents the profit and service fees charged by banks or trading platforms. This markup includes transaction costs, risk coverage and profit. If the market rate for CAD/USD is 0.7200, a customer might receive a rate of 0.7150 when selling or 0.7250 when buying CAD. The difference represents the spread or commission charged by the service provider. The size of this markup can vary between different providers. It's important to compare rates and fees across multiple services.

Which assets are correlated with CAD/USD?

The Canadian dollar (CAD) is strongly correlated with commodity prices, especially oil, given Canada's significant energy exports. Its exchange rate with the US dollar (USD) tends to move in tandem with global crude oil prices, particularly West Texas Intermediate (WTI) crude. Additionally, the CAD is influenced by broader commodity markets, including metals like gold and copper, which are key components of Canada's export economy.