Last week’s high: C$1.6808
Last week’s low: C$1.6597
Canadian Inflation Bolsters Canadian Dollar Demand
Towards the end of last week, the Pound to Canadian Dollar exchange rate began to recover most of the week’s losses as oil prices fell and the Pound was supported by the latest UK data.
Thursday saw the publication of Britain’s July retail sales report, which showed a surprising rebound in consumer activity thanks to warm weather, the World Cup and the strong performance of online retailers.
On top of this, the Canadian Dollar tumbled amid resilience in the US Dollar (USD), and news that a key Canadian oil pipeline had been delayed. As oil is Canada’s most lucrative commodity, this weighed heavily on the Canadian Dollar.
However, Friday’s session saw the Pound to Canadian Dollar exchange rate slump again. Not only did the Pound continue to be weighed by broad concerns about how a ‘no deal’ Brexit could impact Britain’s economy, but Canada’s latest Consumer Price Inflation (CPI) inflation rate report was much higher than expected.
As Canadian inflation printed above expectations, Bank of Canada (BoC) interest rate hike bets rose and the Canadian Dollar pushed GBP/CAD lower again.
CAD Outlook: Canadian Retail Sales and Trade Developments in Focus
The Canadian Dollar’s strong-streak could continue in the coming days, as Brexit concerns persist and the Pound is unlikely to find much notable support in this week’s relatively low-influence UK ecostats.
If Bank of Canada (BoC) interest rate hike bets remain high and upcoming Canadian data impresses, the Pound to Canadian Dollar exchange rate could be in for another week of losses.
This week’s most notable ecostats will be Tuesdays Canadian wholesale sales results, and Wednesday’s June retail sales report.
Canadian retail sales are likely to be particularly influential, and if Canadian consumer activity surprises investors the Canadian Dollar could see a shift in demand.
Any further developments in North American Free Trade Agreement (NAFTA) renegotiations, oil prices or general US trade protectionism news could also influence the Canadian Dollar in the coming week.
09:30 UK Public Sector Net Borrowing
11:00 UK CBI Industrial Trends Orders
13:30 Canadian Wholesale Sales
13:30 Canadian Retail Sales
11:00 UK CBI Distributive Trades
09:30 UK Finance Mortgage Approvals
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