Bounce In Crude Oil Price Sends GBP NOK And GBP CAD Exchange Rates Lower

Published: Wednesday, 6 March 2013 09:00 BST - Written by John Cameron

STORY LINK Bounce In Crude Oil Price Sends GBP NOK And GBP CAD Exchange Rates Lower

The Pound is not the only asset to have endured a torrid start to 2013 – crude oil has also come under sustained selling pressure since the turn of the year, sending the price of a barrel of Brent crude down to it lowest level of 2013 during Monday’s session. The wholesale oil price had dipped by over 7% in the last five weeks, hinting at investors’ concerns regarding the state of the global economy.

Yesterday’s session brought a slight correction in the price of a barrel of crude oil, partly thanks to a bullish assessment of China’s future economic prospects from the nation’s leader Wen Jiabao. A markedly less bad than expected set of whole-of-eurozone retail sales numbers for January also helped commodities prices yesterday. The official figures fro eurstat, the European Union’s official statistics bureau, showed a monthly increase of 1.2% in shop sales in the euro area. Analysts had been anticipating a marginal month-on-month improvement of only 0.2%.

The news provided a fillip for oil-producing nations, as the euroland provides a key source of demand for their exports of ‘black gold’. The news saw the Norwegian Krone gain some ground against Sterling, sending the Pound Norwegian Krone exchange rate (currency : GBP NOK) down to 8.6240 by the latter part of the European session. The Canadian Dollar also performed creditably against Sterling – GBP CAD traded steadily throughout the day and made a renewed run at the psychologically-key 1.5500 level once again just before Europe’s equities close.

North America provides both of the highlights for today’s session in the form of the latest Bank of Canada policy decision and the release of this month’s Federal Reserve Beige Book. These publications have the potential to determine not just the GBP USD and GBP CAD exchange rates, but also the risk-sensitive GBP AUD and GBP NZD rates moving forward.

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