Pound Canadian Dollar Exchange Rate Forecast to Fall GBP CAD

December 18, 2015 - Written by Toni Johnson

STORY LINK Pound Canadian Dollar Exchange Rate Forecast to Fall GBP CAD

Sentiment Towards China Stabilises, GBP/NZD Predicted to Decline

The New Zealand Dollar (currency : NZD) has pushed ahead against the Pound Sterling (currency : GBP) during early trading today following an encouraging result from last night’s NBNZ Business Confidence survey for December.

November’s version of the closely-monitored sentiment gauge printed at 14.6, but the jump to 23.0 from the latest edition shored-up support for the Kiwi Dollar; the Pound Sterling New Zealand Dollar, which had been trading in the 2.2400s GBP NZD, dropped down to as low as 2.2221 as a consequence, as investors priced-in the apparent calming of previously frayed nerves in New Zealand’s business community.

The below-par November showing from the survey was a result of ongoing fears that a ‘hard landing’ from China’s economy might trigger a pronounced economic slowdown in NZ. Sentiment towards China now appears to be stabilising and analysts forecast that this could send the Pound Kiwi Dollar exchange rate GBP NZD lower during coming months.

GBP/EUR Exchange Rate Predicted to Struggle Back Towards 1.4

Elsewhere, support for the euro (currency : EUR) remains relatively strong in spite of the European Central Bank’s ongoing €60bn per month Quantitative Easing programme.

Early morning figures today provide a clue as to why this is the case; October’s whole of eurozone Current Account data showed a monthly non- seasonally adjusted trade surplus of €25.9 bn.

Data released at the same time also revealed that September’s counterpart figure had been upwardly adjusted to €33.8 bn. While the level of goods and services exported by the euroland exceeds its imports by such a staggering monthly amount, the Pound Sterling euro exchange rate is forecast to struggle to break back into the 1.4000s.

GBP/CAD Exchange Rate Predicted to Drift Lower

Looking ahead, this afternoon’s key risk event comes in the form of November’s Canadian CPI inflation data. The Canadian Dollar (currency : CAD) has endured a torrid time against the other major currencies recently as oil prices slumped to fresh multi-year lows. However, analysts forecast that if, as expected, this afternoon’s data points to a healthy increase in the pace of Canadian price rises, then the GBP CAD exchange rate may drift lower.

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TAGS: Pound Canadian Dollar Forecasts Pound Euro Forecasts Pound New Zeala Forecasts