Pound to Euro / Canadian Dollar Exchange Rates Forecast To Head Northwards

Modified: Thursday, 5 December 2013 11:02 BST - Written by Toni Johnson

STORY LINK Pound to Euro / Canadian Dollar Exchange Rates Forecast To Head Northwards

Price action during today’s session promises to be dominated by two central bank policy decisions on this side of the Atlantic. The Bank of England leads the way with its latest announcement due at midday today. It’s almost a given that interest rates will once again remain at 0.50% but the tone of any accompanying ‘forward guidance’ statement will be closely watched for hints on the UK central bank’s future policy direction. Previously similar statements have suggested that UK interest rates will rise when the overall level of unemployment in Britain drops to 7.0%. Any analogous assertion would be likely to prove supportive to the Pound but this positive effect could be watered-down if the BoE adds a caveat that any future rate hikes will be contingent on the relative level of UK inflation at the time.

Another Cut Could Send Pound Euro Exchange Rate Above 1.2118 GBP/EUR

The main intrigue of the day follows shortly after the BoE’s announcement when the European Central Bank issues its latest announcement. Another cut in the eurozone’s key lending rate would surely send the Pound Euro exchange rate (GBP/EUR) up to a fresh 10 ½ month high above the 1.2118 which it struck during Monday’s trading session. In a more likely scenario, ECB President Mario Draghi will issue a downbeat assessment of the current state of the mainland European economy during his post-decision press conference – an outcome which would see GBP EUR edge slightly higher.

Sterling to Canadian Dollar Exchange Rate Forecasted to Rise

Elsewhere, it appears highly likely that the Pound to Canadian Dollar exchange rate (GBP/CAD) will continue to head northwards following the Bank of Canada Governor Stephen Poloz’s comments of yesterday bemoaning the fact that inflation is slipping to unhelpfully low levels in his nation’s economy. The Pound Canadian Dollar exchange rate traded up to its highest level since 2009 earlier this week and further gains are highly likely for the pair moving forward.

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TAGS: Canadian Dollar Forecasts Daily Currency Updates Euro Forecasts Eur Forecasts