If the Bank of Canada was to buy Canadian dollars on the foreign exchange market,what will the likely result be?

Question

Quizplus · Accepted Answer

If the Bank of Canada buys Canadian dollars on the foreign exchange market, it will increase the demand for Canadian dollars, leading to an increase in the exchange rate of the Canadian dollar. This is because more buyers will be willing to buy Canadian dollars, increasing their value.

If the Bank of Canada Was to Buy Canadian Dollars