The Canadian Dollar has performed well over the past few weeks, with the most notable news arriving in the form of the over-performing inflation data which was released last week. This gave the CAD a significant boost and lowered the bets of an interest rate cut in early 2020. However, the bets still sit at around a 50% chance, so investors are remaining cautious. For the GBP, a revision in the Q3 GDP data saw a rise from 0.3% to 0.4%, giving a last-minute boost to the Pound before the year wraps up.
Canadian GDP Data Shows Growth but Only at 0.1%
In the run up to Christmas the market has begun to ready itself to close over the festive period. But before this, Canada had its singular, high-impacting data release in the form of its GDP data which was released yesterday. The GDP growth has been slow for Canada, with a 0.1% growth being reported month on month. This was the same figure that was released yesterday which did little to spark the optimism of lowering rate cut expectations going into the new year. The chances of a cut are now being tipped at around 50%, previously the percentage had dropped to 25%.
GBP Experiences Gains After GDP Data Revisions and Boe Governor Change-Over Lends Support to Sterling
The GBP has had a couple of days, with the release of the revised figures for GDP data in Q3 for the UK. The revisions showed that the growth was 0.4% opposed to the previously reported 0.3%. This 0.1% increase lent some support for the GBP. In other news, the Bank of England selected their new governor in Andrew Bailey, this also gave further support to the Pound as he was regarded as ‘a safe pair of hands’.
For news concerning Brexit, the UK government passed Boris Johnson’s EU withdrawal bill with ease through parliament at the end of last week. But this did little to rally the Pound as investors are still wary of the potential incidence of a no-deal Brexit occurring. The door was left open for the possibility of a no-deal after the UK PM announced that the Conservatives had placed a hard deadline on Brexit for December 2020. Meaning that negotiation time has been herded into this time slot and should no agreement happen by this deadline then the UK will leave the EU without a deal, something that has investors worried.
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