Analysts Forecast that Near-Term Upside for Pound Canadian Dollar GBP CAD Exchange Rate Could Prove Ephemeral

March 4, 2016 - Written by Frank Davies

STORY LINK Analysts Forecast that Near-Term Upside for Pound Canadian Dollar GBP CAD Exchange Rate Could Prove Ephemeral

US Dollar (USD) Exchange Rates Decline after a Mixed Jobs Report

Not for the first time during recent months, the latest US jobs figures – published a short time ago – proved to be a decidedly mixed bag. The headline grabber was another stellar set of job creation numbers, which revealed that a whopping 242,000 new positions had been generated in the world’s number one economy last month, significantly beating forecasts. Meanwhile, the overall rate of US unemployment remained at 4.9% - exactly the same level as last month – as per the consensus expectation amongst analysts.

The above factors represented positives for the US Dollar (currency : USD), but the official labour market data also contained one major negative; the February earnings figures, which have a significant bearing on analysts’ projections for US disposable incomes moving forward, showed a year-on-year increase of only 2.2%.

This represented a meaningful and unanticipated reduction from January’s annualised print of 2.5% and came as a blow to investors hoping for continued improvement in the American economy.

Luke Bartholomew of Aberdeen Asset Management agreed with this assessment, stating that, ‘this should scotch suggestions that the US is about to tip into recession. It's yet more evidence that the labour market is in good shape, although wage growth was more disappointing.’

The Pound Sterling US Dollar exchange rate had been trading in the low 1.4100s during the early part of the European equities session, but the US jobs numbers weakened the Buck, sending GBP USD up to an intraday high of 1.4235.

GBP/CAD Exchange Rate Softens as Global Oil Prices Settle above $37 a Barrel

Elsewhere, the fortunes of the Canadian Dollar (currency : CAD) remain heavily influenced by economic data from the States, so this afternoon’s numbers triggered a similar move higher for the Pound Sterling Canadian Dollar exchange rate which had traded up to as high as 1.9062 GBP CAD a short time ago.

However, with global oil prices settling above the $37 a barrel level today, analysts forecast that this near-term upside for the Pound CAD exchange rate is by no means guaranteed to persist.

International Money Transfer? Ask our resident FX expert a money transfer question or try John's new, free, no-obligation personal service! ,where he helps every step of the way, ensuring you get the best exchange rates on your currency requirements.

TAGS: Pound Canadian Dollar Forecasts Pound Dollar Forecasts