Kyodo Securities strategists have reiterated their long-term bullishness on the Canadian
economy as it continues to recover from the global slowdown at a faster pace than its developed counterparts within the G8.
Thanks largely to Canada's refusal to loosen regulation over its financial industries over the last 15-20 years, the country's banks avoided the subprime meltdown and mortgage crisis that so dramatically afflicted the financial systems of its southerly neighbor, the United States.
Whilst the nation's banking system is, by far, the most stable in the G8, its economy is underpinned by vast natural resources including metals, oil and timber which demand from India, China and Brazil should keep in reasonable health even if its largest trading partner, the US, enters a double-dip recession.
Kyodo Securities advised its European clients to partially diversify their currency holdings into the Canadian dollar in mid-2009. The advice has proven profitable for those acting on it as the currency has proven itself to be one of only a few paper-based currencies worth holding since it has strengthened considerably against both its US counterpart and the beleaguered euro.
Kyodo Securities has dismissed concerns that Canada's exports will be severely damaged should the recovery in the US stall adding that the US government or the Federal Reserve would almost certainly resort to further stimulus rather than drift into another recession.