Suppose the direct quote in New York City for the Canadian dollar is US$.76/C$ and the 180 day forward rate is US$.74/C$. The difference in the two rates would most likely to mean that ________.

Select one:

a. prices in Canada are expected to fall more rapidly than in the U.S.

b. the Canadian dollar's spot rate is expected to appreciate again the U.S. dollar spot

c. U.S. interest rates are expected to rise faster than Canadian interest rates

d. U.S. inflation in the coming year is expected to be less than the Canadian rate of inflation