GBPCAD rates have continues to slip from the very recent highs which saw the levels rise to near 1.70. Having spent much of the last few weeks in the lower 1.60’s and even less than 1.60, the recent spike presented a much improved fresh opportunity for clients looking to buy Canadian dollars with pounds. Overall the market seems likely to favour the Loonie as improving Oil prices and also a weaker pound support the GBPCAD slide.
The price of Oil has risen which has supported a stronger Canadian dollar. Oil is one of the biggest exports from Canada so when this valuable commodity rises in value, so does the Loonie dollar as it helps cement a more positive picture of the Canadian economy. The Canadian economy is also benefiting from its largest trading partner, the USA, performing very well with solid economic growth.
Both economies are on a path to raising interest rates and this gives the appearance of stronger currencies in the future. If you compare this to the UK which is currently struggling under the uncertainty by Brexit and also the concerns over the UK economy, the outlook for the coming weeks seems to favour the slide on GBPCAD in my opinion.
Most clients looking to buy Canadian dollars should I believe be taking advantage of the recent spikes as rates could very easily slip back down to 1.60 or lower. The one saving grace might be the prospect of the UK raising interest rates but there are no guarantees!
Overall there is a belief that rates will not continue to support a stronger pound for too much longer, a weaker pound in the future could cause problems if you need to buy Canadian dollars.
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Thank you for reading and please let me know if there is anything I can help with.