Last week’s high: CA$1.7275
Last week’s low: CA$1.6856
Canadian Dollar Suffers Downturn despite Higher Oil Prices
The Pound Canadian Dollar exchange rate was on the up for the greater part of last week but was curtailed somewhat towards the end of the session when optimism regarding a Brexit breakthrough faded.
After a week of positive news regarding the UK’s future relationship with the EU, objections from the Democratic Unionist Party (DUP) over Theresa May’s ‘backstop’ plan threw a spanner into the works, causing the Pound to lose some of its weekly gains.
Furthermore, with the Canadian Dollar getting support from high oil prices for the greater part of the week’s session, a sharp drop in prices on Friday led to CAD weakness, although the Pound was not fully able to exploit this.
CAD Outlook: Inflation in Focus on Both Sides of the Atlantic
Looking ahead to this week’s session, the GBP/CAD exchange rate may find a rallying point in the week ahead if September’s Canadian inflation data disappoints.
The odds of the Bank of Canada (BoC) raising interest rates again in the immediate future will diminish sharply if inflation wobbles again.
Inflation will also be in focus when the latest UK consumer price index data comes out on Wednesday, with forecasts pointing towards another step up.
If inflation comes in as forecast and accelerates to 2.8% on the year this would give the Bank of England more cause for raising interest rates faster.
Nevertheless, any signs that UK wage growth is still struggling would leave the GBP/CAD exchange rate vulnerable to more losses in the week ahead.
14:30 CA BoC Business Outlook Survey
09:30 UK Unemployment Rate (Aug)
09:30 UK Wage Growth (Aug)
09:30 UK Inflation Rate (Sep)
12:00 UK EU Summit
09:30 UK Retail Sales (Sep)
12:00 UK EU Summit
09:30 UK Public Sector Borrowing (Sep)
12:30 CA Retail Sales (Aug)
12:30 CA Consumer Price Index (Sep)
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