The Euro-Canadian dollar exchange rate has historically been subjected to sharp fluctuations caused by global recessions. When the Great Recession started, the EUR to CAD exchange rate dropped quickly, and the Canadian dollar strengthened against the Euro.
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Since then, this market and its exchange rate have had several recoveries with occasional dips. When the exchange rate drops, you need less CAD to buy EUR, while all the goods from the EU will be cheaper. That’s why timing is one of the most crucial factors when navigating the Euro vs Canadian Dollar exchange if you want to save money.
Whether transferring CAD to EUR or vice versa, you can use this guide to get the best value from your hard-earned money.
Good CAD to EUR exchange rates explained
A good exchange rate between two currencies is the one that has the least conversion losses. However, the exchange rates are often unpredictable since all currencies worldwide are volatile, and numerous factors affect their current value.
For example, some of the factors that drive the value of the Euro are EU policies, government policies, elections, inflation rates, interest rates, ECB monetary policies, political atmosphere, etc. Similar factors also affect the Canadian Dollar’s value and the economic landscape.
Some main factors determining CAD’s value in exchange rates include US-Canada relations, employment rates, commodity prices, BoC interest rates, etc. When exchanging these two currencies, you should ask yourself these three questions:
- How much is one CAD/EUR in EUR/CAD?
- Is CAD or EUR stronger?
- Which currency is growing in value?
Where to convert EUR/CAD
Even though it’s difficult to predict market changes and how they will affect the exchange rate of the EUR/CAD, it’s relatively easy to determine where you’re getting a good exchange rate. When using a specialist foreign exchange, you can expect a mid-market exchange rate for international money transfers.
The interbank or mid-market is the accurate and fair rate that doesn’t include any add-ons. Various specialist services offer lower transfer fees and more competitive rates since they have efficient technology and a higher volume of transactions.
On the other hand, using banks as exchanges comes with hidden rate markups since this is how banks charge their fees for these low-volume transactions.
That’s why it’s generally best to use dedicated exchange platforms to convert EUR to CAD and vice versa. You can expect rates from three to five percent on average, along with quick and secured money transfers.
The best time to exchange EUR for CAD or CAD for EUR
The best moment to exchange EUR to CAD or vice versa is when the exchange rates are favorable. But this is easier said than done. Good rates save you money when making overseas transfers. Luckily, there are ways to find a good rate without rigorously following the market.
Many exchange platforms give expert guidance and share valuable news to help you understand the best time to exchange. Furthermore, they provide charts and statistics to help you make informed decisions. These platforms also offer risk management tools that protect you against negative currency fluctuations.
For example, customers can get a forward contract, which obligates them to make a deposit. In return, exchangers get a fixed rate for all upcoming exchanges. These contracts are agreed on predetermined dates, so you don’t have to consider current exchange rates or market changes.
Additionally, a fixed rate allows easier budgeting and makes it easier to calculate profit margins.
General tips for exchanging CAD/EUR
Here are some general tips you should follow
1. Use a market order
When using a market order, you can get the desired rate. With a market order, you can specify what you think is the correct value for a specific currency exchange rate. When the target has been reached, your transaction will be automatically completed. That helps you get the desired rates without watching the market constantly.
2. Plan in advance
Think about your financial plans and the reasons why you want to make the exchange. Set the desired data and work your way towards it. Being organized and meticulous allows you to recognize opportunities and mechanisms that help you get better transactions.
3. Safety and security considerations of exchanging currencies online
Apart from efficiency and favorable costs, you also need a secure exchange platform. It’s essential if you’re trading consistently with more significant sums. Most of the reputable exchange platforms come with high-level security systems.
Look for a platform that’s regulated by a reputable authority – you should also exchange your money on platforms that have years of experience.
Conclusion
We’re only scratching the surface here. If you want to exchange EUR/CAD regularly to gain a profit, or you simply plan on traveling and want to make timely exchanges so you have that extra money in your pocket, take the time to learn about the exchanges, current rates, market trends, etc.
You have to be invested to some extent and keep up with the latest trends, including political and economic events.
