Canadian dollar
The Canadian dollar, CAD or C$, is the unit of currency of Canada. It is divided into 100 cents (¢).
History
Canada decided to use the dollar instead of a pound sterling system because of the ubiquity of Spanish dollars in North America in the 18th century and early 19th century and because of the standardization of the American dollar. The Canadas, in particular, favoured the dollar — the Bank of Montreal issued bank notes in dollars in 1817 — whereas the Atlantic colonies, with stronger ties to Britain and weaker ones to the United States, preferred the £.s.d. system. The Province of Canada declared that all accounts would be kept in dollars as of January 1, 1858, and ordered the issue of the first official Canadian dollars in the same year. The colonies that would come together in Canadian Confederation progressively adopted a decimal system over the next few years.
Finally, the government passed the Uniform Currency Act in April 1871, tying up loose ends as to the currencies of the various provinces and replacing them with a common Canadian dollar. The gold standard was temporarily abandoned during World War I, and definitively abolished on April 10, 1933.
Canadian currency
Canadians use coins and bills (called "bank notes" officially, but not in ordinary usage) of similar denominations to American money. In fact, the historical sizes of the coins less than 50¢ are identical to those of American coins due to both nations using the Spanish dollar as the basis of their money. Quantities of American coinage circulate in Canada at par, and some Canadian coins circulate in the United States as well, though recent changes to the appearance and composition of recent Canadian coinage has made it more difficult for these coins to be used in America. In Canada, it is common to find American 1¢, 5¢, and 10¢ coins in circulation (just like there are Australian 5, 10, 20, and 50 cent coins in New Zealand and vice versa;) this interchangeability led to some concern when the United States Mint decided that the new Sacagawea dollar coin would have the same colouring as the Canadian $1 coin, the "loonie".
Canadian coins are issued by the Royal Canadian Mint and struck at their facilities in Winnipeg. Bills are issued by the Bank of Canada and printed in Ottawa. All wording on bills appears in both of Canada's official languages, English and French. The same applies to special wording on commemorative coins. All of the standard wording on coins is identical in both languages, except for the name and title of Canada's monarch, which appear in abbreviated Latin.
Canadian coins were originally issued in bronze (1¢) and silver (5¢ up). Gold coins for circulation were issued from 1912 to 1914 only. In 1922, copying an earlier change in the United States, the 5¢ coin was enlarged and changed to nickel; unlike the United States, pure nickel was used except during World War II and the Korean War. A silver dollar coin similar to that issued in the United States was first proposed in 1911 and a few trial pieces exist, but a proper dollar coin did not arrive until 1935. The percentage of silver in silver coins was reduced in 1919 and 1967, and in 1968 they were all replaced by pure nickel coins of the same size or nearly so. The rising price of nickel eventually forced the 5¢ coin (commonly called the "nickel") to be changed to cupro-nickel in 1982. At about the same time the 1¢ coin was twice made smaller, and in 1997 it was changed to copper-plated zinc. Finally, in 2000 all coins below $1 were changed to steel with copper or nickel plating. Unfortunately, there have been some problems with compatibility between the new coins and coin-operated devices like vending machines and public telephones. The 50¢ piece is regularly minted, but not in large quantities; it is very rare to come across this coin in everyday transactions.
On October 21, 2004, the Royal Canadian Mint unveiled a "25¢ poppy coin". This coin features a red-coloured poppy embedded in the centre of a maple leaf above a banner reading "Remember - Souvenir". The mint claims that this is the first colour coin in circulation in the world. It also states that, with normal wear and tear, the colour should remain for a number of years. The colouration compounds are attached to the metal on a specially prepared 'dimpled' section of the coin, and seem to come off easily if deliberately rubbed. The coin will retain its full value even if the red poppy has worn off or been removed.
As of fall 2004, the highest denomination coin minted in Canada is a $350 gold coin produced for the collector market, though the bullion values make its market value much higher than its face value.
The most significant recent development in Canadian currency was the withdrawal of the $1 and $2 bills in 1989 and 1996, respectively, and their replacement with coins of new design. The new $1 coin, first issued in 1987, is colloquially called the "loonie," for the loon on its reverse, and the name is frequently applied to the currency unit as well. It is made of nickel plated with "aureate bronze". The $2 coin, carrying a polar bear, is called by analogy the "toonie" (also spelled "twonie", making the etymology clearer), and has two sections differing in colour. Unlike several American attempts to introduce a dollar coin, the new coins were quickly accepted by the public, owing largely to the fact that the mint and government made it a "cold turkey" switch.
Beginning in 2001, the Bank of Canada introduced a new series of bills: the new $10 was first issued on 17 January, 2001; the new $5 on 27 March, 2002; and the new $100, $20, and $50 bills during 2004 (in that order). The new $100 bill was issued on 17 March, 2004, the new $20 on 29 September, 2004, and the new $50 on 17 November, 2004. Called "Canadian Journey", this series features elements of Canadian heritage and excerpts from Canadian literature. The $20, $50, and $100 notes introduce watermark security features for the first time on Canadian currency; they also boast significantly expanded holographic security features. The $10 is slated to receive these new security features for the 2005 issue. All 2001 series notes also include the EURion constellation, on both sides of the bill.
| Canadian coins | |||||||
| Value | Common name | Composition | Obverse | Reverse | Mass | Diameter | Thickness |
| 1¢ | penny (Fr. cent noir) | 94% steel, 1.5% nickel, 4.5% copper plating | Queen Elizabeth II | Maple leaf | 2.35 g | 19.05 mm | 1.45 mm |
| 5¢ | nickel | 94.5% steel, 3.5% copper, 2% nickel plating | Queen Elizabeth II | Beaver | 3.95 g | 21.2 mm | 1.76 mm |
| 10¢ | dime | 92% steel, 5.5% copper, 2.5% nickel plating | Queen Elizabeth II | The Bluenose (a famous schooner) | 1.75 g | 18.03 mm | 1.22 mm |
| 25¢ | quarter | 94% steel, 3.8% copper, 2.2% nickel plating | Queen Elizabeth II | Caribou | 4.4 g | 23.88 mm | 1.58 mm |
| 50¢ | 50¢ piece | 93.15% steel, 4.75% copper, 2.1% nickel plating | Queen Elizabeth II | Canadian coat of arms | 6.9 g | 27,13 mm | 1.95 mm |
| $1 | loonie (Fr. huard) | 91.5% nickel 8.5% bronze plating | Queen Elizabeth II | Common loon | 7 g | 26.5 mm | 1.75 mm |
| $2 | toonie or twonie | Rim — 99% nickel; core — 92% copper, 6% aluminum, 2% nickel | Queen Elizabeth II | Polar bear | 7.3 g | 28 mm | 1.8 mm |
| Canadian Bills (Bank Notes) | |||
| 1986 ("Birds of Canada") series | |||
| Value | Colour | Obverse | Reverse |
| $2‡ | Terra cotta | Queen Elizabeth II | American robins |
| $5‡ | Blue | Wilfrid Laurier | Kingfisher |
| $10‡ | Purple | John A. Macdonald | Osprey |
| $20 | Green | Queen Elizabeth II | Common loon |
| $50 | Red | William Lyon Mackenzie King | Snowy owl |
| $100 | Brown | Robert Borden | Canada goose |
| $1000‡ | Reddish purple | Queen Elizabeth II | Pine grosbeak |
| 2001 ("Canadian Journey") series | |||
| $5 | Blue | Wilfrid Laurier | Children playing hockey and other winter sports; excerpt from "The Hockey Sweater" by Roch Carrier |
| $10 | Purple | John A. Macdonald | Peacekeeping forces and war memorial; excerpt from "In Flanders Fields" by John McCrae |
| $20 | Green | Queen Elizabeth II | Artwork of Bill Reid; excerpt from Gabrielle Roy's novel, The Hidden Mountain. |
| $50 | Red | William Lyon Mackenzie King | The Famous Five and Thérèse Casgrain; quotation from the Universal Declaration of Human Rights |
| $100 | Brown | Robert Borden | Maps of Canada, historic and modern; excerpt from Miriam Waddington's poem, "Jacques Cartier in Toronto" |
‡ Withdrawn from circulation. Currency withdrawn from circulation is still legal tender. As of mid-2004, the 1986-series $5 and $10 bills are still commonplace, but they are slowly disappearing from regular use. $1,000 bills are no longer printed, but are still used by banks and casinos on occasion.
All 1986 and 2001 series bills measure 152.4 mm by 69.85 mm (6 by 2¾ inches).
Canadian currency rumours
A number of urban legends have circulated regarding Canadian currency.
- An American flag is flying over the Parliament buildings on Canadian paper money. This is not the case. The Birds series bills depict a Union Jack flying over Parliament on the $100; a Red Ensign (a former Canadian flag) on the $5, $10, and $50; and the modern maple-leaf flag was on the $2 and $1000 bills. (The $20 depicts the Library of Parliament, with no flag visible.) Those "taken" by the rumour were likely fooled by the bills with the Red Ensign, as the flags are not shown in full colour and the contrasting upper-hoist corner somewhat resembles the American flag.
- The new series $10 bill is being recalled because there is a misprint in the poem In Flanders Fields. The first line as printed, "In Flanders fields the poppies blow," startled many people, who believed the last word should be "grow". John McCrae wrote two versions which were both published, but his original manuscript, the one used by the government and widely used for Remembrance Day ceremonies, reads "blow", meaning to bloom. (The last two lines are, "We shall not sleep, though poppies grow/In Flanders fields.")
- You can pop the centre out of a toonie. This is (or was) in fact true. Many toonies in the first shipment of the coins were defective, and could separate if struck hard or frozen, as the centre piece would shrink more than the outside. This problem was quickly corrected, and the initial wave of "toonie popping" blew over a few months after the coin's introduction. This is in fact true, and still works on modern toonies. If you throw it at the ground hard enough, a couple times, the middle will pop out. Hitting the edge on a hard surface causes deformities on the outside, which puts excess pressure on this middle part. This causes the centre part to be pushed out. 'Separated' toonies can still be redeemed at banks if both parts are turned in, although most people choose to keep them.
- The crown is wrong in the Queen's portrait. When the new coin portrait was first issued in 1990 (see above), a legend surfaced that the artist had simply added the image of a crown to a portrait of the Queen, and that she was never meant to be seen wearing that headgear. This is patently false; she posed personally for the portrait wearing one of her usual crowns.
- Canadian coins are minted in Regina, Saskatchewan. As mentioned, the Royal Canadian Mint is located in Winnipeg, Manitoba. The expression D.G. Regina on the obverse of Canadian coins is Latin for by the grace of God, Queen, referring to the effigy of Elizabeth II.
Value
Inflation in the value of the Canadian dollar has been fairly low since the 1990s, but had been severe for some decades before that.
Because about 85 per cent of their external trade is with the United States, Canadians are concerned primarily with the value of their currency against the United States dollar (USD). The Canadian dollar was more valuable than the USD for part of the 1970s, but has never regained that status. Since flirting with depths as low as US$0.62 (January 18, 2002), the dollar rallied through 2003 and 2004, reaching US$0.85 on November 26, 2004. With no end in sight, some economists predict the dollar could continue its rise into 2005.
On world markets, the Canadian dollar tends to move in the same direction as the U.S. dollar, but less dramatically. A consequence is that an apparently rising Canadian dollar is often falling against most of the world's currencies, and vice versa. For example, the recent "rise" in the value of the Canadian dollar (as widely reported in the Canadian media) has more to do with weakness in the American dollar than the Canadian dollar itself. The Canadian dollar has recently lost value against the euro, trading in February 2004 at €0.60 to the dollar, although by October 2004 this rate had risen to €0.64.
Although there was a great deal of domestic concern when the Canadian dollar was trading much lower than the U.S. dollar, there is also concern among exporters when the dollar appreciates quickly. The rapid rise in the value of the Canadian dollar increases the price of Canadian exports to the United States, which make up a large part of the economy. On the other hand, Canadian industry enjoys advantages from a rising dollar, primarily in that it is cheaper to purchase foreign material and businesses.