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GBP/CAD Exchange Rate Fluctuates as BoC Questions Timing of Rate Hikes

 

Last week’s high: C$1.7720

Last week’s low: C$1.7365

 

Canadian Dollar Dented by BoC Policy Meeting

The Pound to Canadian Dollar exchange rate traded in a wide range last week, mostly as a result of the Bank of Canada’s (BoC) latest policy meeting.

This saw the ‘Loonie’ fall heavily on Wednesday as the bank left its monetary policy unchanged and warned of ‘increased uncertainty about the timing of future rate increases’ in light of deteriorating economic conditions.

However GBP/CAD failed to stabilise at its best levels, with the Pound erasing its gains in the latter half of the week in the face of renewed Brexit pessimism.

 

CAD Outlook: Brexit Vote(s) to Dominate the Pound

Looking ahead, the main catalyst of movement in the GBP/CAD exchange rate this week will undoubtedly be the vote on Theresa May’s Brexit deal in the House of Commons on Tuesday.

This may also be followed by two further votes on a no-deal Brexit and extending Article 50 and is likely to result in some considerable volatility in the Pound throughout the week.

Meanwhile a lull in notable domestic data could limit movement in Canadian Dollar this week, potentially leaving the currency driven by external influences such as shifts in oil prices.

 

Key Events

12th March

09:30 UK Trade Balance (Jan)

09:30 UK Industrial Production (Jan)

09:30 UK GDP (Jan)

19:00 UK Meaningful Vote on Brexit

13th March

12:30 UK Spring Budget

14th March

12:30 CA New House Price Index (Jan)

15th March

12:30 CA Manufacturing Sales (Jan)

 

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To keep up to date with the Canadian Dollar, visit the CAD blog in our Currency News section.

 

Alastair Archbold

Foreign Exchange Manager

aja@fcgworld.co.uk

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