Pound Sterling Softens Against the Canadian Dollar, but a Week of Economic Data Releases Will Test Both

Brexit and Coronavirus Weigh on GBP as Oil Price Collapse Causes CAD Value to Fall

It is safe to say GBP has performed worse out of the two currencies over the past few weeks. The pound starts this week no different, with fresh worries about the Bank of England (BoE) cutting interest rates, the week ahead may be tough for the GBP. Further concern may be ahead as the UK prepares for more economic data releases in the form of jobs data and PMIs. For the resilient Canadian Dollar, the week is just as packed with important data releases and the all-important BoC rate decision which looks likely to remain unchanged.

Softer Pound Sterling Starts the Week Trading Lower Against the Canadian Dollar as BoE Worries Mount

GBP has begun the week trading lower against its Canadian counterpart, as the GBP/CAD exchange rate cuts lower as the pairs ongoing downtrend continues. The Pound closed last weeks trading 0.29% lower against CAD after softening inflation and poor retail sales increased bets of a BoE rate cut on the 30th January. Analysts remain optimistic about GBP/CAD rate however, as Scotiabank expects the rate to trade close to 1.70 at the end of each quarter in 2020. But there is still the possibility of deviation between these intervals however. Canadian banking co-operative Desjardins also has the same forecast pencilled in for the pairing.

Resilient Canadian Dollar Faces a Mountain of Data to Overcome This Week

Despite the Canadian Dollars recent resilience to the tests thrown at it, it still has something to prove as this week’s economic data releases are unveiled. The Bank of Canada will also reveal its interest rate decision on Wednesday, which will likely be the most influential of all the weeks events for CAD. The currency will see the release of inflation and retail sales data on Wednesday and Friday respectively.

For the interest rate decision, the market is banking on the rate to remain unchanged with the recent resilient performance from the currency which has held CAD in good stead for a number of weeks despite its rival currencies poor performances.

If you’re considering buying or selling Canadian dollars and would like to compare rates or know more about the factors that could impact your exchange rate, feel free to contact me directly, I look forward to hearing from you.