The Canadian Dollar has been rising against its currency counterparts recently following some impressively positive comments from the Bank of Canada.
In some off the cuff comments with a German newspaper, Governor Stephen Poloz stated that he is much more forward looking when considering future monetary policy for Canada. This speaks a lot to markets as the current state of the Canadian economy doesn’t warrant a rate hike.
Interest rates are a key determinant at the moment for currency value. In a world with so much uncertainty, when traders are trying to make decisions are currency returns, returns from interest rates are one of the few concrete features.
As such these murmurs from Poloz that he is looking to the future is crucial. He is expected much better inflation in the economy in the first half of 2018 and for continued growth. With oil rising further again on Tuesday by 0.6%, markets received this news in an atmosphere of positive sentiment towards the Loonie, exaggerating it’s improvements.
Turning to the other side of the key pairing since the UK Referendum, the Pound, rates are largely being kept in check for buying Canadian Dollars due to the final conclusion of the UK election saga.
GBP/CAD buying rates are exactly where they were 3 weeks ago effectively. A similar story with most of Sterling’s pairings, but despite the Pound’s strength, the Canadian Dollar may win out at the July 12th meeting. Market activity suggests traders are pricing in a 50% chance of a rate hike based on Poloz’s hints towards his thought process.
I strongly recommend that anyone with a Canadian Dollar based currency requirement should contact me on [email protected] to discuss a strategy for your transfer aimed at maximising your currency return.
I have never had an issue beating the rates of exchange on offer elsewhere, so a brief conversation could save you significant sums of money on a prospective transfer.