Sterling rallys against the Canadian Dollar following inflation data release (Daniel Johnson)

GBP to CAD Rate: Sterling Gains Against the Canadian Dollar Ahead of Bank of Canada Statement

Will Sterling gains be short lived against CAD?

Sterling has strengthen against the Canadian dollar following a a rise in UK inflation. GBP/CAD now sits above 1.61.  The reason for the rise for Sterling was Consumer Price Index (CPI) data. CPI is a measure of inflation, if provides a comparison in price changes on goods and services. It is a key barometer as to the health of the UK economy. Inflation is a serious concern for the UK and is a direct result of Brexit. The uncertainty surrounding Brexit has caused the pound to drop in value considerably. Imports are now far more expensive for UK businesses and they are  raising prices to consumers. In order for consumers to continue spending average wage growth needs to be increasing at a similar pace to inflation and today’s wage data release shows a decline to 2.1%.Inflation showed an increase yesterday above expectations to 2.9%. The pound benefited as a result. This is due to rumours the Bank of England could consider a rate hike if inflation continues to rise. I am of the opinion a change in monetary policy is not the solution. In order for inflation to fall we need a stable government and clarity over the big issues in Brexit, trade and immigration.

Canada’s economy is currently looking very healthy due to positive data across the board, I would expect gains for the Canadian dollar against Sterling until we have further clarity on Brexit. This maybe a small window of opportunity for CAD buyers.

If you have a currency requirement I would be happy to help. You need to have an experienced broker on board in order to take advantage of rates when a brief spike occurs, especially in the current climate. If you have a currency provider already in place I am prepared to perform a comparison against them. It will take minutes and could potentially save you hundreds or even thousands of pounds. I can be contacted at  [email protected].