Interest rate expected to Fall

Hi Terry,

Interest rates in Canada are a little different than the US. In Canada interest rates are compounded semi-annually and in the States they are compounded monthly. So a posted rate of 5.0% or published rate of 5.0% will be higher in the states because it will be compounded monthly. As for the single greatest factor that effects interest rates is the economy. The US and the Canadian economy are very similar and the US is Canada's largest economic partner and vice versa. So to your question, does the exchange rate have anything to do with it--directly no but indirectly yes because exchange rate effects export numbers for Canada and lower exports (more importantly lower export nets) than that will negatively effect the economy and the interest rate. But inflation is the largest factor when it comes to interest rates.