According to the Canadian Imperial Bank of Commerce (CIBC) report on small business activity, a quarter of Canadian small businesses will suffer as a result of the rise in the Canadian dollar, with firms in Ontario and British Columbia most vulnerable to the dollar's gains.
One in four firms — including those with exposure to the export market and others within the tourism sector — will feel at least some pinch from the Canadian dollar's sharp appreciation this year.
So far this year, it has risen about 16 per cent against its US counterpart. In Wednesday's report, CIBC said it expects the Canadian dollar to hover around the 75 cent (US) mark “for the foreseeable future.”
However, about 20 per cent of small businesses in Canada will also see some indirect benefit of the Canadian dollar’s rise, mainly because of its dampening effect on interest rates, the report said.
