Toronto -- One of Canada's largest banks in Toronto issued a warning to the central bank Tuesday to intervene in the appreciation of the country's dollar, the loonie.
The Canadian Imperial Bank of Commerce's World Markets division released a report warning the Bank of Canada it risked "a hollowing out of the country's industrial base" by allowing the loonie to remain close to par with the U.S. dollar.
"If the loonie is overvalued for a few years, we may be sacrificing business plant and equipment on the altar of a strong currency." wrote CIBC Chief Economist Avery Shenfeld. "Plants that close because they are unprofitable at current exchange rates might permanently relocate elsewhere. They won't suddenly come back if currency later cheapens."
