The ability to buy Canadian dollars above 1.70 two weeks ago was an opportunity we did describe as well worth capitalising on. There is an overall belief that the pound will continue to display signs of weakness and the economic conditions are more supportive for the Canadian currency. I stand by these sentiments and whilst there are potentials for a surprise shift back above 1.70 the wind looks to remain with CAD sellers.
Whilst the US dollar strengthened against the Canadian dollar weakening the Loonie slightly yesterday, economic data for the UK today could be a real mover. Retail Sales figures at 9.30 am will give us a clearer picture on the spending habits of British consumers, a lifeblood to the economy. Big news for the Canadian economy is tomorrow with Inflation data, one of the reasons for the strength of the Loonie has been rising interest rates in Canada. Should Inflation rise the Bank of Canada could well be on course to raise their base rate further which would strengthen the Loonie.
All in all it appears to me the conditions in the UK economy versus the Canadian economy favour the Canadian one and therefore the Canadian dollar. However exchange rates can change unexpectedly, another factor to consider regarding the Canadian dollar is the price of Oil which has been softening a little after a recent spike, this is what helped the price of the Loonie to rise above 1.70 too. Falling demand globally as experts predict a warmer winter will only exacerbate the issues of major oversupply which has been a major thorn in the side of the price of Oil in recent months and years.
If you have a transfer buying or selling the Canadian dollar we are here to help with the latest trends and news to help you make an informed choice and decision on any transfer. For more information at no obligation or cost please email me Jonathan Watson by emailing [email protected].
Thank you for reading this post and I look forward to discussing some strategy with you.