Will GBP Recover its Position Against the CAD? (Matthew Vassallo)

GBP/CAD rates have remained flat during Wednesday’s trading but the general trend still remains Sterling negative. With the markets focusing on the much debated possible “Brexit” from the EU, it is unlikely Sterling will receive any sustained support in the run up to the referendum in June.

The CAD has been boosted by an improvement in their exports and a recovery in oil prices. Despite poor inflation data last week GBP/CAD is still holding firm around 1.86 on the exchange and the days of 2 certainly seem behind us now. Whether we will see the Pound gain enough support to recover back to 1.90 is certainly debatable and in my opinion clients holding out for that level are gambling on future policies, as the current market conditions will not lean towards this scenario.

It’s been a quiet week for Canadian economic data releases so the markets will be focusing on tomorrow’s UK Retail Sales figures, which are always considered a key release by investors. If these come in above expectation I would expect the Pound to curb any further losses and an improvement on GBP/CAD would be likely.

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