US GDP continues to rise

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This may force the US Fed to raise interest rates to constrict inflation south of the border. If the US Fed raises interest rates to combat inflation in the United States, it will put pressure on the value of our Canadian dollar. If US rates go up, the demand for US dollars will also go up, as they are needed to purchase the now more lucrative US treasuries. If US rates go up and Canadian rates do not, the demand for US dollars (through supply and demand) will go up in relation to the value of Canadian dollars. Our Canadian dollar will be less valuable in foreign markets. This will make imports (like food in the winter time) more expensive for us as our dollar loses purchasing power.