Canada

Canada holds dollar reserves and settles trade in USD. Every time the Fed expands M2, that premium compounds against the CAD, on top of domestic inflation.

CPI: World Bank (FP.CPI.TOTL.ZG). US M2: Federal Reserve FRED (M2SL). Reserve premium = cumulative M2 growth − cumulative US CPI.

In January 2002, one Canadian dollar bought one US dollar. Today it buys around 72 to 74 cents. That gap didn't appear overnight — it's the accumulated result of two decades of diverging monetary policy, oil price swings, and the Bank of Canada consistently running a slightly looser ship than the Federal Reserve. For anyone whose financial life straddles that border, the drift is real money.

The 2021 to 2023 inflation surge hit Canada hard. Canadian CPI peaked at 8.1% in June 2022, the highest since 1983. Housing in Toronto and Vancouver had already been running hot for years before that. A family renting in Vancouver watched their monthly costs climb faster than their wages, while across the border in Seattle or Bellingham, dollar-earners booking weekend trips north felt like they were getting a deal. Same continent, completely different financial experience.

For Americans moving to Canada — and the numbers have grown steadily since 2016 — the math is genuinely interesting. Your USD salary converts to more Canadian dollars than it did five years ago. Groceries, healthcare, and transit feel manageable. But if you're saving in CAD and plan to retire in the US, or support family back home, you're quietly accumulating currency risk every year you stay. The loonie has a long history of moving sharply when oil prices drop or when the Fed and Bank of Canada diverge on rates.

This isn't a reason to panic — Canada's economy is deep, stable, and transparent about its data. But purchasing power isn't just about today's exchange rate. It's about what a dollar saved in 2019 buys in 2025, after inflation and currency drift both take their cut. The calculator shows you that real number.