Pound to Canadian Dollar in tight range as oil prices fall

March 23, 2015 - Written by Tim Boyer

STORY LINK Pound to Canadian Dollar in tight range as oil prices fall

Today's Canadian Dollar Exchange Rate Outlook Remains Firm as Oil Prices Continue to Fall

The weakened Pound Sterling traded in a tight range against the Canadian Dollar as the North American currency was weighed upon by a report, which suggested that oil prices would struggle to rise back to the record high levels seen last year.

Crude oil, which is Canada’s biggest commodity export, fell back under the $55 per barrel level after Saudi Arabia, the world’s biggest exporter of oil, said that it will only consider tapering production if other producers outside of the Organisation of the Petroleum Exporting Countries (OPEC) will begin to taper their output. A strengthening of the US Dollar also put pressure on oil prices.

‘In the past 15 years, the global economy was defined by rising commodity prices, zero interest rate policy, and a weak US Dollar. This cycle has now gone into reverse with a decelerating industrial economy in China and the rise of US shale. A combination of a strong US Dollar, higher interest rates and subdued growth may keep commodity prices in check in 2015,’ said Bank of America Merrill Lunch in a report.

Pound to Canadian Dollar Outlook for the Week

The rest of the week is set to be a quiet one for the Canadian Dollar due to a total lack of market moving economic data releases.

The only piece of news due on the domestic front will be Thursday’s speech due to be given by Bank of Canada Governor Stephen Poloz.

The governor will highlight how the Canadian economy is performing so a dovish report is likely to put pressure on the CAD, however, if he delivers a hawkish speech we the Canadian currency could advance .

The Pound Sterling exchange rate complex meanwhile came under pressure from increased concerns over the outcome of the UK general election due to be held on May 7.

The Confederation of British Industry (CBI) warned that the UK economy could be weakened if the vote results in a power vacuum.

With no clear winner expected the markets are expecting a period of negotiation between the political parties to either form a coalition or minority government. In what form such a government will take is anyone’s guess.

The Pound Sterling was also weakened by the release of industrial trends orders data and the latest CBI compiled business optimism index.

Industrial trends orders tumbled from a reading of 10 to 0 in February, a sharp decline from the dip to 9 forecast by economists.

Canadian Dollar Exchange Rates Today:

The Canadian Dollar to Australian Dollar exchange rate is -0.82 pct lower with a conversion rate of 1 CAD equals 1.01273 AUD.
The Canadian Dollar to Euro conversion rate is -0.67 pct lower at 0.72919 CAD/EUR.
The Canadian Dollar to Pound Sterling exchange rate is +0.42 pct higher with a conversion rate of 1 CAD equals 0.53405 GBP.
The Canadian Dollar to US Dollar conversion rate is +0.58 pct higher at 0.79929 CAD/USD.
The Pound to Canadian Dollar conversion rate is -0.41 pct lower at 1.87247 GBP/CAD.
The Euro to Canadian Dollar exchange rate today is converting +0.67 per cent higher at 1.37139 EUR/CAD.
The US Dollar to Canadian Dollar conversion rate is -0.58 pct lower at 1.25111 USD/CAD.

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