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Impressive Canadian Jobs Data Keeps GBP/CAD near Session Lows

Last week’s high: C$1.7131

Last week’s low: C$1.6932

GBP/CAD Sees another Week of Losses despite Sterling’s Attempt to Rebound

The Pound put in a stronger performance last week against major currency rivals like the Euro and US Dollar as investors were hesitant to keep selling GBP after its weakness in May.

However, Sterling wasn’t able to advance on a broadly stronger Canadian Dollar.

Throughout the week hopes that trade issues between the US and Mexico could be resolved and some strong Canadian ecostats kept the Canadian Dollar appealing.

Investors were particularly impressed with Friday’s Canadian job market report from May, which showed that Canada’s employment change had unexpectedly printed another strong figure of 27.7k while the key unemployment rate shocked investors with a surprise improvement to 5.4%. This was Canada’s lowest unemployment rate since at least 1976.

The Pound was unable to hold its ground, as while the currency cooled from a month of losses it still remained unappealing due to UK political uncertainties.

 

CAD Outlook: Politics Take Focus amid Quieter Economic Calendar

Aside from some Canadian housing data, there isn’t much on the economic calendar that is likely to influence Pound to Canadian Dollar exchange rate movement in the coming week. This is likely to leave investors focused on potential political developments and shifts in trade sentiment.

Unless UK growth or production data is particularly surprising, the UK Conservative Party leadership contest is most likely to influence Pound movement throughout the week.

If it perceived as likely that a hard Brexit advocate will succeed Prime Minister Theresa May as the next PM. This is keeping investors anxious, although analysts still believe a softer Brexit is more likely than a no-deal Brexit.

As for the Canadian Dollar, any fresh developments in US trade protectionism, particularly tensions between the US and Mexico, are likely to influence markets.

 

Key Events

10th June

09:30 UK Trade Balance

09:30 UK Growth Rate

09:30 UK Construction Orders

09:30 UK Manufacturing and Industrial Production

13:15 Canadian Housing Starts

11th June

09:30 UK Job Market Report

13th June

13:30 Canadian New Housing Price Index

14th June

13:30 Canadian New Motor Vehicle Sales

 

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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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