December 17, 2018 - Written by John Cameron
STORY LINK Pound to Canadian Dollar Exchange Rate News: GBP/CAD Rises as Chinese Economic Data Worries Persist
GBP/CAD Exchange Rate Rises as CAD Investors Worry over Slowing Global Economy
The Pound Canadian Dollar (GBP/CAD) exchange rate is up today, and is currently trading at CAD$1.6899 as ‘Loonie’ investors remain cautious over geopolitical tensions and signs of a slowing global economy.
The UK, meanwhile, has been stuck in political deadlock with British Prime Minister Theresa May’s visit to the European Union last week to renegotiate aspects of her Brexit deal were unsuccessful, leaving Sterling weakened.
This ignited criticism from Parliament and former minister Sam Gyimah, who commented that Downing Street was involved in ‘a concerted attempt to discredit every plausible alternative as they run down the clock.’
The Canadian Dollar (CAD), however, has been weakened by decreasing oil prices and uncertainty over its export industry amid continuing US-China trade tensions, ahead of Wednesday’s November inflation data.
Pound Sterling to Canadian Dollar Exchange Rate Up despite Brexit Deadlock
Today saw the release of Rightmove’s UK house price index for December, which showed a further decrease in home prices of -1.5% following November’s -1.7% drop.
The Pound (GBP) has been generally weakened by Theresa May attempts to bolster support for her Brexit deal after last week’s disappointing meeting with EU leaders.
Business Secretary of State, Greg Clark, spoke out against the Brexit deadlock by commenting:
‘We can’t just have continuing uncertainty and I think Parliament should be invited to say what it would agree with, and that’s something that I think businesses up and down the country would expect elected members to take responsibility, rather than just be critics.’
May has railed against suggestions of a second referendum, commenting that it would ‘divide our country at the very moment we should be working to unite it.’
Politics aside, Wednesday will see a slew of UK inflation data, with the most important being the retail price index for November which is expected to weaken.
CAD/GBP Exchange Rate Dips as Interest Rate Hikes Face Possible Pause in 2019
The Canadian Dollar (CAD) has been struggling from declining sentiment following comments from the Bank of Canada (BoC) Governor, Stephen Poloz, who hinted that the rate of increase in interest rates would slow down in 2019.
The continuing trade tensions between Canada and China following the recent arrest of Huawei’s Chief Financial Officer, Wang Huawei, has soured the two nation’s economic relations.
Today saw the publication of Canada’s portfolio investment in foreign securities figures for October – which showed an increase at CA$14.93bn against last month’s CA$10.56bn.
Tomorrow, meanwhile, will see the printing of October’s manufacturing shipments figures, which are expected to increase.
GBP/CAD Outlook: Brexit and Geopolitical Tensions Remain in Focus
The GBP/CAD exchange rate is expected to remain driven by political developments in the coming week, with Brexit facing mounting criticism from MPs as Theresa May attempts to fight off calls for a second referendum.
CAD investors, however, will be keeping a close eye on geopolitical developments with any suggestions that China will lower tariffs and open up its economy strengthening the struggling ‘Loonie’.
However, many Canadian Dollar traders will be looking ahead to Wednesday’s inflation figures for November; currently these are expected to show a decline to -0.2%, which would likely lower CAD sentiment.
Wednesday will also see the publication of a number of UK ecostats, with the most important being the Retail Price Index for November, which is expected to remain static.
Thursday, however, will occupy Sterling investors’ attention with the release of the Bank of England’s interest rate decision.
Although the BoE isn’t expected to raise interest rates, traders will be looking for any signs of bullishness in the accompanying forward guidance, with any upbeat expectations likely to strengthen the GBP/CAD exchange rate.
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TAGS: Pound Canadian Dollar Forecasts