Will GBPCAD remain above 1.70?

Oil Prices and Brexit Casuing Volatility for Pound to Canadian Dollar Exchange Rates

The Pound to Canadian Dollar has risen of late as improvements in the outlook for Sterling combine with some fresh uncertainties over the outlook for the Canadian economy. Positivity for the Pound stems from an expectation that Michel Barnier and the EU are prepared to negotiate with the UK, implying less chance of a no-deal Brexit. This has helped the GBPCAD rate to rise above 1.70 lately, will this continue?

The Loonie Dollar has also weakened following the news that NAFTA (North Atlantic Free Trade Agreement) negotiations are not quite going Canada’s way. With Canada seeking a number of clauses to ensure vital industries such as media are protected from US influence, relations are under pressure.

With the US dictating much of the policy for future NAFTA relations and Canada relying heavily on its trade with the US for commerce. Expectations are that the Loonie Dollar might find itself under further pressure in the future. The lack of clarity over which direction talks will take is weighing the Canadian Dollar against the Pound.

Sterling might find some interesting events this week to move rates including the latest UK Bank of England decision on the Thursday at 12. Investors are expecting no change in policy but any hints at future interest rate hikes could see the Pound rise.

The Bank of Canada recently held their interest rate having previously risen and now appearing to be backtracking slightly on potential future rises. Whilst there are high expectations for future positivity from Canada which will reflect in the prices we see that are available, clients might find sterling is the winner over the coming week.

If you have a transfer to consider this week the UK Bank of England interest rate decision looks to be the most important upcoming news, for more information at no cost or obligation please contact me at jmw@currencies.co.uk.