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Poor Canadian Data and Bank of England (BoE) Hawkishness Causes GBP/CAD Surge

Last week’s high: C$1.7732

Last week’s low: C$1.7429

Pound Capitalises on Canadian Dollar Weakness Due to Bank of England (BoE) News

Last week was a good week for the Pound, and a bad week for the Canadian Dollar. While earlier in the week, the Pound was weakened by Brexit jitters and the Canadian Dollar was strengthened by higher oil prices, demand for both currencies turned around and GBP/CAD put in solid gains.

On Thursday, the Bank of England (BoE) held its June policy decision meeting and more members of the Monetary Policy Committee (MPC) than expected voted to hike UK interest rates. With a tighter-than-expected vote of 6-3 to keep rates frozen, the Pound saw a surge in demand.

Friday’s Canadian data made it even easier for the Pound to Canadian Dollar exchange rate to climb, as Canada’s latest key data came in well below expectations. Canada’s inflation and retail sales results fell short in every notable print, causing concerns that that Bank of Canada (BoC) may not be as confident about tightening Canadian monetary policy in the coming months as expected.

CAD Outlook: Latest UK and Canadian Growth Figures due Next Week

Next week’s economic calendar will be quieter for the most part, at least until Friday’s key UK and Canadian growth stats are published.

Early in the week, central bank news is likely to drive the Pound to Canadian Dollar exchange rate. Bank of England (BoE) Governor Mark Carney will hold a speech on Wednesday morning, followed by another from Bank of Canada (BoC) Governor Stephen Poloz during Wednesday’s American session.

In particular, Poloz’ reactions to last week’s disappointing Canadian inflation and retail sales stats could influence Canadian Dollar trade.

Sterling trade is most likely to be affected by next Friday’s UK growth report. If it impresses, Sterling could strengthen as investors would become more confident that the Bank of England could hike UK interest rates as soon as August.


Key Events

27th June

09:30 BoE Governor Carney Speech

20:15 BoC Governor Poloz Speech

29th June

00:01 UK Consumer Confidence

09:30 UK Growth Rate

09:30 UK Mortgage Lending and Approvals

09:30 UK Business Investment

13:30 Canadian Growth Rate


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


Alastair Archbold

Currency Dealer

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