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Pound to Canadian Dollar Exchange Rate Slips as Retail Sales Edge Higher

December 18, 2020 - Written by John Cameron

The Pound to Canadian Dollar (GBP/CAD) exchange rate struggled to hold onto any gains on Friday, as the Brexit transition period deadline looms and talks show little signs of progress.

Boris Johnson said EU negotiators must ‘bring something to the table’ in Brexit talks to avoid the UK crashing out the single market without a deal in two weeks’ time.

This comes follows comments from Michel Barnier to European Parliament this morning who said:

‘I cannot say what will come in this last home straight of negotiations. We have to be prepared for all eventualities.’

German MEP David McAllister has said the European Parliament is ready to ‘look at any Brexit deal that emerges in the coming days’, a hint that the Brussels parliament is prepared to move past the Sunday deadline it imposed earlier this week.

In other news, retail sales in the UK fell 3.8 percent in November of 2020, although a contraction, figures still beat forecasts.

Canadian Dollar (CAD) Exchange Rates Gain on Positive Retail Sales Figures



The Canadian Dollar (CAD) gained against Pound Sterling after positive month-on-month retail sales figures.

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Retail sales in Canada edged up 0.4 percent from the previous month in October 2020, the sixth consecutive monthly increase since the record decline in April and beating forecasts of 0.2 percent.

As a result, Canadian Dollar exchange rate investors are more hopeful for the Canadian economic recovery, with Covid-19 rollouts boosting the value of the nation’s key and most lucrative commodity, oil.

Oil prices remain just below $47 a barrel, though if prices rise we could see the CAD/GBP exchange rate edge higher.

GBP/CAD Exchange Rate Forecast: Could Rising Oil Prices Bolster the ‘Loonie’ This Week?



Sterling is likely to remain downcast throughout the weekend and into next week if Brexit talks continue to show little progress between the UK and EU on critical issues of trade.

However, any further signs that the UK and EU could concede on a post-Brexit trade agreement, would prove Pound-positive.

Canadian Dollar investors will be monitoring Canadian economic growth for next week, the economy grew 0.8 in September 2020, with forecasts looking to a 0.6% growth for September, which could bolster the Canadian Dollar.

The ‘commodity-correlated’ Canadian Dollar could see a rise if oil prices continue to climb over the next few days.

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