1. What is USD/CAD Exchange Rate?

The USD/CAD exchange rate represents how many US dollars (USD) one Canadian dollar (CAD) can buy. It's the reciprocal of the CAD/USD rate, which shows how many Canadian dollars one US dollar can buy.

2. How Does the Calculator Work?

The calculator uses the simple reciprocal formula:

Where:

• \( CAD/USD \) — Canadian to US dollar exchange rate (decimal)
• \( USD/CAD \) — US to Canadian dollar exchange rate (decimal)

Explanation: If 1 CAD = 0.75 USD, then 1 USD = 1/0.75 = 1.3333 CAD.

3. Importance of Spot Rates

Details: Spot exchange rates are crucial for currency conversion in real-time transactions, international trade, and financial reporting.

4. Using the Calculator

Tips: Enter the CAD/USD spot rate as a decimal value (e.g., 0.75 for 1 CAD = 0.75 USD). The value must be greater than zero.

5. Frequently Asked Questions (FAQ)

Q1: What's the difference between spot and forward rates?
A: Spot rates are for immediate settlement (usually 2 business days), while forward rates are for future dates.

Q2: How often do exchange rates change?
A: In forex markets, rates change continuously during trading hours (24/5 for major currencies).

Q3: Why is the reciprocal relationship important?
A: It allows conversion between the two quoting conventions used in different markets.

Q4: Are there fees in addition to the spot rate?
A: Yes, financial institutions typically add a spread or commission to the spot rate.

Q5: What factors influence USD/CAD rates?
A: Interest rate differentials, commodity prices (especially oil), economic performance, and geopolitical factors.