Pound to Canadian Dollar Forecast: GBP vs CAD Exchange Rate Gains before BOC Decision

January 19, 2015 - Written by David Woodsmith

STORY LINK Pound to Canadian Dollar Forecast: GBP vs CAD Exchange Rate Gains before BOC Decision

The Pound to Canadian Dollar currency pair posted a modest gain during the North American session thanks, in part, to data showing an increase in UK house prices.

As a cooling in the UK’s property market contributed to the Bank of England scaling back its interest rate hike projections, the news that prices are rising after two months of declines was Pound supportive.

Sterling also continued to benefit from last week’s extensive market movement as the Swiss National Bank’s shock decision to remove its cap with the Euro saw investors flock to the relative stability of the Pound.

Latest Canadian Dollar Exchange Rates

The Canadian Dollar to Australian Dollar conversion rate is +0.5 pct higher at 1.02065 CAD/AUD.
The Canadian Dollar to Swiss Franc exchange rate is +2.61 pct higher with a conversion rate of 1 CAD equals 0.73583 CHF.
The Canadian Dollar to Euro exchange rate today is converting -0.23 per cent lower at 0.72089 CAD/EUR.
The Canadian Dollar to Pound Sterling exchange rate converts +0.41 per cent higher at 1 CAD is 0.55399 GBP.
The Canadian Dollar to US Dollar exchange rate is +0.16 pct higher with a conversion rate of 1 CAD equals 0.83669 USD.

At the close of last week the Canadian Dollar advanced on the back of an improvement in the price of crude oil – Canada’s main commodity.

However, the price of Brent fell back bellow 50 Dollars a barrel as Iraq announced record levels of production and concerns regarding China’s economic outlook reduced demand expectations. As stated by Reuters; ‘Oil prices have dropped by more than half since last June as output around the world soared while demand growth slowed. Although the International Energy Agency (IEA) said last week a reversal in the trend was possible this year, it added that prices may fall further before rising.’

GBP CAD Exchange Rate Today

The GBP/CAD exchange rate pairing was also slightly affected by Canada’s International Securities Transactions report, which fell from 9.53 billion Canadian Dollar’s in October to 4.29 billion Canadian Dollars in November. This week the Bank of Canada is scheduled to deliver its interest rate decision.

Given the recent slump in crude oil prices, ongoing global economic concerns and the extensive volatility witnessed in the currency market last week, the central bank is likely to adopt a cautious tone.

Any particularly dovish comments regarding the Bank of Canada’s interest rate outlook or the nation’s growth prospects could weigh on the ‘Loonie’.

As the week progresses, Canadian Dollar movement could also occur as a result of Canada’s Manufacturing Shipments figure, Wholesale Sales number and Consumer Price Index. Canada’s retail sales report will also be of interest. Sales are believed to have fallen by -0.2% on the month in November following October’s stagnation. CPI, meanwhile, is forecast to show that the pace of inflation fell from 2.0% on the year to 1.6%, with the core measure falling by -0/4% on the month and the non-core measure sliding by -0.6%.

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