Assume that we commence with short term interest rates in the US and Canada being equal, and assume that both countries are enjoying a rate of inflation of 0%. Then in period p, short term interest rates rise in Canada, while remaining unchanged in the United States. There is no change in the inflation rates in the two countries. The expected Can $-US$ spot rate in the period P+1 remains unchanged. Would the US$ depreciate or appreciate against the Can$ in the period p, according to the Interest Parity theory? Would US$ depreciate or appreciate, between p+1 and p?