4 Dollars – Canada

In 2008, Canada entered the global financial crisis with a relatively strong economic position, but its currency, the Canadian dollar (CAD), experienced significant volatility. The year began with the "loonie" near historic highs, briefly reaching parity with the US dollar in 2007 and remaining strong in early 2008, trading above USD $0.98. This strength was largely driven by a global commodity boom, particularly in oil, which saw prices surge to a record $147 per barrel in July. As a major exporter of natural resources, Canada benefited from these high prices, attracting foreign investment and bolstering the currency.

However, the situation reversed dramatically in the latter half of the year following the collapse of Lehman Brothers and the ensuing global financial panic. As investors fled to the safety of the US dollar, and commodity prices crashed—with oil plummeting to near $30 per barrel by year's end—the Canadian dollar went into a steep decline. It lost roughly 20% of its value against the US dollar in just three months, falling to a low of approximately USD $0.79 in October 2008. This sharp depreciation reflected both the global "flight to safety" and a severe downturn in Canada's key export sectors.

The Bank of Canada responded aggressively to the crisis, cutting its benchmark interest rate from 4.5% in January to a historic low of 0.25% by April 2009. This monetary easing aimed to stimulate the domestic economy but also contributed to the currency's depreciation by reducing its yield appeal. Ultimately, the 2008 currency situation highlighted the Canadian dollar's dual identity as a "commodity currency," vulnerable to global price swings, and a proxy for global risk sentiment, which drove its extreme volatility from historic strength to a multi-year low within a single tumultuous year.