So, if the US Federal Reserve decides to raise theirs, the US dollar will get stronger, influencing the USD to CAD forecast.īased on publicly available information. However, two can play the game of increasing interest rates. When Canadian interests are lower than those in the US and other countries, the opposite will happen, and the Canadian dollar will most likely weaken. This would put pressure on other currencies, and the Canadian dollar would grow stronger.
As a result, they’ll start buying Canadian dollar-denominated securities. A relatively high-interest rate in Canada compared to those from the US and other countries will catch foreign investors’ attention. In terms of Canadian dollar predictions, interest rates are essential for attracting short-term foreign capital. These financial instruments can either speed up or slow down the economy. Interest rates determine how much you stand to earn on deposits and how much you’ll pay back if you want to borrow money.
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