Inflation and the Canadian Dollar Term Paper by Top Papers

The paper relates that in November of 2008, Statistics Canada reported that the inflation rate in Canada dropped to roughly 2.0%, which is down from 3.5% only one quarter ago. Similarly, the paper notes that the inflation rate in the United States fell to 1.1%, which is a significant decrease from comparatively staggering figures in July of the same year, where inflation was at 5.6%. The paper reveals that Canada's decreased inflation rate represents the first time since 2003 that its inflation rate has been less than that of the United States and this is undoubtedly related to a drop in the price of oil, which is now less than one-third of what it was in July of last summer: "It has fallen from nearly $150 USD per barrel to below $40 USD per barrel. But that is over a limited time frame of only four months. The latest inflation numbers incorporate three interesting energy price movements" (Carrick, 2008 par.3).