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“How low can it go?” economists asked as the Canadian dollar continued its precipitous decline from parity with the U.S. dollar last seen in early 2013. With the loonie hovering around the US75 cent mark, that three-year descent may finally be close to bottoming out, says Kurt Reiman, global investment strategist at BlackRock.

Reiman says the Canadian dollar may have become something akin to a petro currency during the booming years of oil and gas, thus accounting for the majority of its 25 per cent drop in value over the past three years.

“When you look at the price of crude oil and overlay that with the value of the Canadian dollar against U.S. currency, you have a strong relationship,” says Reiman.

“Oil prices demonstrated a bit of a spring recovery and so did the Canadian dollar, which followed oil prices down through the fall.”

He notes that the Canadian economy is “a lot more vibrant than oil and gas.” Over the past five years, Statistics Canada records that revenue generated by the energy sector never crested above 10 per cent of gross domestic product.