The Canadian dollar (CAD) is the official currency of Canada. As with the US dollar, it is abbreviated with the ‘$’ symbol. It is divided into 100 cents and is the seventh most traded currency in foreign exchange markets.
Canada adopted the Canadian pound in 1841. It was equal to four US dollars. In 1853 it was tied to a gold standard with the British gold sovereign and gold American Eagle as the basis at a rate of $4.86 US dollars.
The Uniform Currency Act of 1871 replaced the Canadian pound and other provincial currencies with the Canadian dollar, first pegged to gold and later to the US dollar until it was floated in 1970.
The gold price in Canadian dollars following the US closing of the gold window was $64 per ounce. The Canadian dollar has since gradually lost value against gold and the yellow metal hit a high of $1,714 an ounce in September 2011.
Canada holds 3.4 tonnes of gold as reserves, equivalent to 0.2% of its foreign currency reserves.
Originally sovereigns were minted in silver and their cent subdivisions in copper and silver. Canadian gold $1 and $5 coins were issued between 1912 and 1914. Silver fineness of coins was gradually reduced over time through use of steel, nickel and copper and Canadian coins ceased to contain any precious metals in 1968. Today’s Canadian coins are nothing more than cheap metal alloys.
The Royal Canadian Mint is the official mint of Canada. In addition to the country’s fiat coins, it also produces bullion, the most popular coins being the gold (since 1979) and silver (since 1988) Canadian maples. The gold maple is 0.9999 fine gold and is popular with bullion investors.