The Canadian Dollar’s value changed little today, with few economic releases noted and no significant political events CAD enjoyed a stable start to the week. The exception to this rule was GBP/CAD rates which rose by more than 1% in a single trading day, with lows of 2.011 and highs of 2.035 recorded.
GBP/CAD gained a welcome boost after weeks of losing ground from Sterling weakness as well as CAD strength. The main reason for Sterling strength across the board today has come from the unexpected sale of Tesco’s South Korean arm, Homeplus, for £4.2bn. This not only brought some gains and stability to the stock market, which has been faltering and a major stumbling block for Sterling strength recently, but also this sudden introduction of capital into the Pound which would normally been held in South Korean Won or USD automatically strengthens Sterling.
After Labor Day in Canada, and the economy settles back into work tomorrow all eyes will be on the BOC interest rate decision to be announced on Wednesday. GBP/CAD and other CAD pairings will be affected by other forces as well, but CAD’s value specifically for this week and likely the coming month will be largely decided by Wednesday’s decision.
Having slashed rates preemptively recently, it is very unlikely that there will be further cuts. However, the press conference following the decision will give us some valuable insight into the perceptions of the BOC on the state of their economy and any future cuts. With the election fast approaching, their views will likely be responded to and paraphrased by most of the main candidates, causing significant volatility.
Email me on [email protected] if you have a CAD requirement. GBP/CAD has moved up recently with this sudden gift of Sterling strength, but rates have been moving in the opposite direction for the past three weeks. Anyone looking to secure CAD at these historic 6 year highs should contact me for a free quote on your transfer. Quote this article to receive favourable rates of exchange and tailored advice to your situation.