The Canadian dollar has gained significantly over sterling over the last few weeks. The pound has lost more than five cents over the last fortnight. Theresa May is under pressure due to the lack of Brexit in negotiations. The Irish border is the point of contention and if this is resolved we can expect substantial gains for the pound.
The next key event is the UK budget, due to be delivered by Phillip Hammond on Monday. The DUP have threatened to vote down the budget of they are unhappy with how Brexit is progressing.
Bank of Canada raise interest rates
The Bank of Canada (BOC) kept in line with expectations and raised rates from 1.5% to 1.75%. There was also a positive outlook in terms of monetary policy moving forward with the possibility of a hike this year and a high probability of interest rate rises next year.
This is welcome news for Canadian dollar sellers considering the nightmare that was the renegotiation of the North American Free Trade Agreement (NAFTA). If you have Canadian dollars to sell it would be wise to keep a close eye on Brexit updates as the situation unfolds. Be wary of hanging on for further gains as if news does come through in regards to the Irish border it could prove costly.
Looking at risk verses the reward it may be wise to consider performing a transfer of a portion of your funds at current levels. Personally, I would perform 20-30% of my requirement at current levels, keep a close eye on Brexit updates, and be prepared to move quickly should news filter through of an Irish border deal. A stop loss could prove beneficial, so your currency automatically purchases should the market start to move against you.
For more information on the tools available to help you manage your currency transfer, or to find out more about the factors impacting Canadian dollar exchange rates in the short term feel free to use the form below to get in touch. I’ll be happy to respond personally and discuss your query.