Pound to Canadian Dollar: No deal Brexit probability damaging Sterling value
The pound to Canadian dollar exchange rate has been suffering lately as the market continues to price in the possibility of the no-deal Brexit taking place on the 31st October. Expectations are mixed for the outcome on Brexit. Nothing is completely set in stone, but the market is becoming more and more of the opinion a no-deal Brexit will take place.
What this means for GBP/CAD exchange rates is that as the uncertainty around a no-deal increases, we could see the pound remaining under pressure in the future, and GBP/CAD rates struggling. We know the significance of Brexit on the pound, investors’ concern regarding the outlook have seen the pound lower.
Any signs that perhaps there will be some form of extension could see the pound perform better, this was behaviour that was observed previously for the pound. Also, any signs that the UK might strike some kind of a trade deal, could also help the pound.
Economic data that could affect the Pound to Canadian Dollar exchange rate
This week, there is key economic news in the form of UK Retail Sales due tomorrow, this could see some volatility on GBP/CAD exchange rates. Looking forward on the Canadian dollar, we also have important news relating to the price of Oil which has been a big factor on the currency.
Whilst central banks globally are cutting interest rates, the Bank of Canada has refrained and this might well see the currency stronger in the future. Expectations ahead may centre around whether or not they will choose to cut interest rates like their North American cousins, the United States.
For now, with the New Zealand central bank, US central bank, and probably widely expected the Eurozone cutting in September, there is a perception the CAD is the ‘best of a bad bunch’, which has helped it retain form.
Of course, any deviation from this view might see a reversal of fortune for the currency. If you have a position to buy or sell currency ahead, please do not hesitate to contact us to discuss the latest news and information.