This week’s session has seen the Canadian Dollar maintain Friday’s positive momentum.
Foreign Currency Market Update – GBP / CAD Update
Last week’s session brought significant fluctuations in the GBP CAD market, with an intra-week trading range of over three cents for the pair. The Canadian Dollar came under selling pressure in the early part of the week, following China’s first downgrading of its annual growth target for eight years, which hit global crude oil prices hard. This sent the GBP CAD rate to 1.5804, but the good times did not last long for Canadian Dollar buyers – the Bank of England held UK base rate at 0.50% at midday on Thursday and opted not to allocate any further funds to its asset purchase scheme. The Bank of Canada followed suit in maintaining its current monetary policy stance, announcing later on Thursday that it was holding its key overnight lending rate at 1.00% for the twelfth meeting in succession. However, it was the BoC’s accompanying statement which caught the eye, striking a go-ahead note regarding the future prospects for the Canadian and world economies and raising investors’ expectations of the likelihood of a Canadian interest rate rise later this year.
The week ended with a flood of support for the CAD, following the release of strong US labour market figures on Friday. The closely-monitored Non-Farm Payrolls numbers showed that 233,000 new jobs had been generated in the non-agricultural sectors of the giant American economy last month. It was the third month in succession that over 200,000 new jobs had been created in the world’s leading economy, which is also Canada’s largest export market by a wide margin. Canadian jobs data, released earlier on Friday was similarly positive, sending the GBP CAD rate all the way down to 1.5492 by close of business Friday, its lowest level since last September.
This week’s session has seen the Canadian Dollar maintain Friday’s positive momentum. With little key data due for release this week in the UK or Canada, September’s key interim support at 1.5409 could come into play if this move continues. Clients needing to buy Canadian Dollars in the near-term may want to consider taking care of at least half of their requirement sooner rather than later, in case such a situation transpires.
Summary of major upcoming data releases that we think may move the market.
- Pound to Australian Dollar Exchange Rate Forecast – The AUD came under further selling pressure in the middle part of last week
- Pound to Canadian Dollar Exchange Rate Forecast – The GBP CAD exchange rate steadily lost ground throughout last week’s session
- Pound Sterling to Canadian Dollar Foreign Currency Exchange Rate Forecast – The Canadian dollar had a good week
- Pound Sterling to Canadian Dollar Foreign Currency Exchange Rate Forecast – CAD rallies on gold surge
- Pound Sterling to Canadian Dollar Foreign Currency Exchange Rate Forecast – Sterling Rebounds from Technical Support