In recent years, rising inflation expectations have helped the dollar because investors assumed the Federal Reserve would hike interest rates in response to higher prices. And though surging commodity prices have raised concerns of higher inflation, markets believe the Fed will keep its commitment to low rates and hefty asset purchases. "The economy is performing quite strongly, so that is supporting expectations for the Bank of Canada to hike ahead of the Fed," said Karl Schamotta, chief market strategist at Cambridge Global Payments.