Canadian Dollar
The Canadian Dollar, represented as CAD, is the official currency of Canada. It's managed and issued by the Bank of Canada, the nation's central bank.
The Canadian Dollar was first introduced in 1858 to facilitate trade with the United States and the United Kingdom. It replaced the Canadian pound at a rate of 4 Canadian Dollars to 1 Canadian pound. Since 1970, the Canadian dollar has been a floating currency, meaning its value is set by the foreign exchange market.
Convertible:Yes
Transferable:Yes
Exchange rate regime:Floating
Available currency pairs
Transaction types
FX
Spot
Delivery date
T; T+1; T+2
Liquidity
High
FX
Forward
Maximum maturity
24 months
Liquidity
High
Did you know?
The Bank of Canada's monetary policy aims to maintain inflation at a medium-term target of 2%. It uses various tools to achieve this, such as adjusting the target for the overnight rate, which influences other interest rates and affects people's spending decisions.
The Bank of Canada also uses a system of inflation-control targeting, where it sets a specific range for the inflation rate. If the inflation rate moves out of this range, the Bank will adjust its monetary policy to bring it back within the target range.
Key Features of CAD
The Canadian Dollar is divided into 100 cents. Canadian coins come in denominations of 5, 10, 25 cents, and 1 and 2 dollars, commonly known as a loonie and a toonie, respectively. Banknotes are issued in denominations of 5, 10, 20, 50, and 100 dollars.
Canadian banknotes feature the portrait of the reigning monarch on the front and Canadian cultural symbols and landscapes on the back. Each denomination has a distinct color, and the notes incorporate a variety of security features.
Expert Opinion
The CAD is considered a commodity currency due to Canada's vast natural resources, particularly oil. As a result, its value often fluctuates with commodity prices, especially oil.
Economists often monitor the CAD for signs of economic health in the resource sector. As Canada is the U.S.'s largest trading partner, the CAD-USD exchange rate is also of significant interest.
Regulations
The Bank of Canada regulates the CAD, overseeing monetary policy, promoting a safe, sound financial system, and providing secure, quality banknotes. Financial institutions in Canada must comply with the Bank of Canada's regulatory requirements and the regulations set by the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC), including robust Know Your Customer (KYC) and Anti-Money Laundering (AML) procedures.
Important information
Payments in CAD to Canada
Payment instructions must contain:
Payment instructions should contain the beneficiary's IBAN, name, and address.
Payment Processing Time
The time taken for a payment to reach the recipient's bank account can vary. Domestic transfers within Canada are typically processed quickly, while international transfers may take a few business days. Consider the processing time when planning your payment to ensure timely delivery. The iBanFirst Payment Tracker can help you track those payments, and ensure a smooth and efficient payment experience.
Fees and Charges
Banks and financial institutions may apply fees and charges when processing international payments. These fees can vary, so it is advisable to check with your bank to understand the charges associated with your transaction. Check out iBanFirst’s Savings Calculator to estimate how much you could save on your next international payment.
Keep in mind
Public holidays
When a holiday falls on a weekend, the next business day becomes a holiday
01
January
New Year's Day
10
July
Canada Day
11
November
Remembrance Day
25
December
Christmas
26
December
Boxing Day
Good Friday
Variable
Victoria/Patriot’s Day
Last Monday preceding May 25
Labour Day
First Monday in September
Thanksgiving
Second Monday in October
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