How To Limit The Effects Of Inflation On Your Savings
You have probably heard the proverb; there are only two certainties in life; death and taxes. While this is true, another certainty that should be added is inflation. Inflation is usually referred to as the worst tax around. Inflation however is not a tax, but the fact that your dollar is worth less and thus buys less. Inflation can affect almost anyone and can severely limit the buying potential and savings of an individual or family. Here are some tips to limit the effects of inflation on your savings.
Strength Of The Canadian Dollar
The Canadian Dollar has appreciated dramatically over the past 6 months compared to the greenback. Economists at TD Bank suggested in a report dated July 12, 2007 that the strength of the Canadian dollar will help to limit Bank of Canada rate hikes through the coming quarters. However, their report also predicted another quarter point raise to come in September as a direct result of stronger economic growth and elevated inflation. TD added that “the strength in the Canadian dollar should not only help reign in inflation by restraining economic growth and import prices, but [they] feel it will also limit the degree to which the Bank needs to hike rates.”