High dollar a concern: Carney

The Governor of the Bank of Canada, Mark Carney, said Friday Canada's strong dollar poses a threat to the country's economic growth.

Carney told Bloomberg Television at the annual World Economic Forum in Davos, Switzerland, that the high currency is among the "serious headwinds" facing the economy and a reason the  bank has held its benchmark interest rate at one per cent since September.

"One of the risks to the Canadian economy is persistent strength in the Canadian dollar," Carney told Bloomberg.

The loonie has gained more than five per cent against the U.S. dollar since the beginning of 2010. It fell below parity late on Friday afternoon, down .75 of a cent at 99.93 US, as traders sought the safety of the American currency because of growing unrest in Egypt.

Carney said the central bank will consider the dollar's strength and account when deciding how to stay within its inflation target.