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Pound Sterling Canadian Dollar (GBP/CAD) Exchange Rate Rises as Oil Price Sinks

February 25, 2019 - Written by John Cameron

Pound Sterling Canadian Dollar (GBP/CAD) Exchange Rate Rallies as Oil Prices Slide

This afternoon the Pound Sterling Canadian Dollar (GBP/CAD) exchange rate rose 0.5%, trading at an inter-bank rate of CA$1.7222.

Sentiment for the Canadian Dollar slipped today as a dip in oil prices offset news that US President Donald Trump would delay an increase in tariffs on Chinese imports.

President Trump resumed his attacks on OPEC, tweeting:

‘Oil prices getting too high. OPEC, please relax and take it easy. World cannot take a price hike – fragile!’

The pairing started this week’s session weighed down, as Sunday sparked hope buoying the risk-sensitive ‘Loonie’, as Trump tweeted:

‘I am pleased to report that the US has made substantial progress in our trade talks with China on important structural issues including intellectual property protection, technology transfer, agriculture, services, currency, and many other issues.

‘As a result of these very productive talks, I will be delaying the US increase in tariffs now scheduled for March 1. Assuming both sides make additional progress, we will be planning a Summit for President Xi and myself, at Mar-a-Lago, to conclude an agreement. A very good weekend for US & China!’

GBP/CAD Exchange Rate Rises on Article 50 Extension Rumours

Earlier this morning it was revealed that the second ‘meaningful vote’ has been rescheduled, now to take place on 12th March – 17 days before the UK is due to leave the EU.

Rumours circulated that the Prime Minister was considering whether or not she would delay Brexit for up to two months.

However, during a meeting between the PM and German Chancellor, Angela Merkle at a summit in Egypt Theresa May reiterated that the UK wanted to leave the EU on time.

Restating her opposition to an Article 50 extension, May said:

‘An extension to Article 50, a delay in this process, doesn’t deliver a decision in Parliament, it doesn’t deliver a deal. All it does is precisely what the word ‘delay’ says. Any extension of Article 50 isn’t addressing the issues.’

GBP/CAD Outlook: Will a Rise in Canadian Inflation Buoy the Canadian Dollar?

The Pound Canadian Dollar (GBP/CAD) exchange rate could rise during the session tomorrow if Theresa May’s speech in Parliament sparks Brexit optimism.

The UK Inflation Report Hearings are also likely to cause movement in the GBP/CAD pairing.

If the tone of the report is upbeat and positive about the post-Brexit economy then it could see Sterling rise.

Wednesday will likely see further movement in the pairing, as Canadian inflation data is due to be released.

If the Bank of Canada Consumer Price Index rises in January it could increase sentiment for the Canadian Dollar, as the report is likely to help guide expectations for further interest rate hikes.

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