GBP/CAD exchange rates are still very much reliant on political issues on both sides. Investors and speculators alike await news on progress with either Brexit or the NAFTA (North American Free Trade Agreement).
On the Brexit side of things I would expect plenty of market volatility as we see changes in the general feeling around the potential outcome of negotiations.
We have already seen a shift in Brexit sentiment on numerous occasions. In general when sentiment becomes more positive it leads to gains for the pound against all major currencies, any signs of a deal not looking good are having the opposite affect.
Moving onto the NAFTA agreement, there had been very positive signs about progression with this merely a few weeks back, but now it does appear that talks are somewhat stalling and with Donald Trump being directly involved it does throw up somewhat of a lottery as to where this heads next.
Tonight we have the Federal Reserve interest rate decision where expectations are for yet another interest rate hike. This is virtually nailed on as it stands so I wouldn’t expect any major market movements off of the back of that.
In terms of news from the U.K we have fairly minimal economic data but Politics will be key, we are due to have head of the Labour party Jeremy Corbyn and prime Minister Theresa May speaking. The Conservative party conference also starts in a few days which will more than likely be all over the news. As readers may be aware there are numerous members of the Conservative party that are against Theresa May’s plans, so there could be some interesting media off the back of this. Political uncertainty can be damaging for a currency so watch out for a drop in value of the Pound.
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