The Pound to Canadian dollar exchange rate is sitting tentatively north of 1.70 at the time of writing, as there appears to be downward pressure on the pound’s value as the end of the week gets closer.
The EU Summit will start this evening and continue until the weekend, where Brexit will be in main focus. One of the key events of the week will be when the UK Prime Minister Theresa May will be speaking in Brussels to the 27 EU leaders regarding her Brexit plans. One of the key sticking points at the moment is how Northern Ireland will be treated during the transitional period as well as afterwards. The UK and EU Brexit negotiators are at loggerheads at the moment, with European Council President Donald Tusk earlier this week suggesting that he doesn’t have high hopes of a deal being reached. He went as far as to say that a no-deal Brexit is ‘more likely than ever before’ earlier this week.
The markets have been gearing up for Theresa May’s speech, and later this week there will be talks behind closed doors to which she isn’t invited. The pound’s value is driven by Brexit updates at the moment and I expect any announcements to impact the pound to Canadian dollar’s exchange rate.
Events which could affect the Canadian Dollar’s value
At the end of this week there will also be inflation data released for Canada, and the markets will follow this closely as it could determine when the Bank of Canada will next plan to amend interest rates.
CAD exchange rates have been boosted recently owing to strong oil prices and also the new NAFTA agreement being announced (now called the USMCA), and I think there needs to be a major announcement in sterling’s favour to push the GBP/CAD exchange rate back towards the highs we saw earlier this year.
These releases come out at 13.30pm on Friday and the expectation is for inflation levels of -0.1% month on month. At the same time Retail Sales data will be released and there are expectations of 0.4% for August.
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