Canadian vs. US dollar

I recently inherited $10,000 (Canadian) from a relative living in Ottawa. To exchange those Canadian for US dollars would have meant a big loss, so I left the cash in Canada, hoping the exchange rate would improve. The rate did improve slightly during the spring and summer, but is still unfavorable. Should I wait for the Canadian dollar to improve vs. the US dollar or should I transfer the funds now? M.S.

You are asking for guidance on currency speculation. Without claiming any magic, i would guess that little difference will show up in the exchange rate very soon. In the meantime, you can gain a higher return from the equivalent of an insured bank account in Canada, because it has no equivalent of Regulation Q holding down the rate of interest payable to savers.

Thus, you may find that your savings account will grow faster in Canada than the fewer dollars would in the United States. You will be liable for taxes on the interest in either Canada or the U.S.

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