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The Canadian dollar is looking pretty weak. But unfortunately, it could get worse before it gets better. The loonie could even hit an all-time low against the United States dollar, according to some analysts. And if that happens, there is one TSX stock I wouldn’t touch with a 50-foot pole — no matter how high the dividend gets.
Why the loonie matters
Before I get into the TSX stock itself, let’s go over why the loonie matters so much — especially when it comes to oil and gas companies producing out of the United States. When the Canadian dollar depreciates against the U.S. dollar, it means that it takes more Canadian dollars to purchase one U.S. dollar. For Canadian energy companies operating in the United States, a weaker Canadian dollar can increase their costs of production in several ways.
Canadian energy companies often need to import equipment, machinery, and services from the United…
