Since 2002, we’ve been seeing a pattern in which periods of CAD appreciation alternate with periods where the trade balance increases:
The cycle goes something like this:
- When the trade balance is high, the CAD appreciates. The appreciation brings the trade balance down, and the CAD hits a plateau.
- While the CAD is plateaued, the trade balance increases.
- Go to 1.
Right now, we’re at step 2: the CAD has been trading in a narrow range around parity with the USD since November, and during this time, the price of oil and other commodities that Canada exports have risen sharply – and so has the trade balance.
Worthwhile Canadian Initiative 
In the Globe today there is a short article on the Canadian dollar being undervalued:
link
Thanks for the link. I’m starting to notice a pattern: I post something, and it shows up a week later in the MSM…