The Pound to Canadian Dollar exchange rate received a boost today and recovered some of its recent losses, after the Canadian Dollar dropped as oil prices hit the headlines.
With the Canadian economy being reliant on its exports, and oil being one of its largest exports the value of oil is therefore likely to impact the Canadian Dollar. This is what’s known as a commodity currency and those planning a currency exchange involving the Loonie should be aware of this as it can lose/gain value when commodity prices hit the headlines.
Oil was in the headlines today because it hit an 8-week low after losing 5%, and this brings the oil price close to $50 a barrel. The reason behind the drop was because of a rise in US oil inventories and therefore an oversupply of the commodity.
CAD exchange rates are also coming under pressure due to the high possibility of an interest rate hike in the US, which would limit demand for the Loonie as investors can hold their funds in the US and achieve a higher return. There is an expected 3 rate hikes to come this year with some analysts outlining the need for 4, so this is another subject those with a GBP/CAD requirement should pay attention to.
Even with the Brexit just around the corner now I can see the GBP/CAD rate breaking 1.65 should the issues weighing on CAD continue to be an issue.
If you are planning to make a currency exchange involving the Pound and the Canadian Dollar, it’s well worth your time getting in contact with me on [email protected] in order to ensure you make a well informed decision on when to make that particular transfer, as well as benefiting from highly competitive exchange rates from one of the UK’s leading foreign currency brokerages. Just provide me with a basic outline of your currency requirement and I will be back in touch with you as soon as possible.