Yesterday the Pound was able to post a considerable advance on a broadly softening ‘Loonie’ as the bank of Canada refrained from hinting at interest rate increases for the first time in over a year.
The Canadian Dollar Exchange Rate was in the region of 0.6018 against the British Pound as of 14:15 GMT
While the Bank of Canada held rates at their previous levels, as economists expected, the central bank adopted a different tone to that used in the previous 24 policy statements.
Given the very mixed domestic data published in recent months, and with the BOC announcing that inflation is likely to remain below the two per cent target for six months longer than previously estimated, a rate hike is looking increasingly unlikely.
The Canadian Dollar continues to feel the pressure today, and as currency strategist Chris Turner observed; ‘We’ve got a broadly weak Dollar trend and the Canadian Dollar is actually underperforming under that trend. The currency is overvalued and they’re more concerned about exports.’
However, while the Canadian Dollar languished close to a two-year low against its US counterpart prior to the release of US initial jobless claims data, the GBP/CAD pairing fluctuated as UK manufacturer’s expectations for output growth declined in October.
The CAD/GBP exchange rate hit a high of 0.5980
A monthly poll conducted by the Confederation of British Industry revealed that compared with September’s survey less manufacturing firms expect to see output expand over the next three months, with the measure falling to its lowest level since February.
That being said, the gauge of general confidence among firms surged from 7 to 24 – the most rapid increase since the beginning of April.
Economists had forecast that the index would rise to 17.
In response to the data CBI’s director of economics stated; ‘The manufacturing sector has increasing confidence in the UK’s recovery.’
Sterling was also supported by the expectation that tomorrow’s UK GDP report will show quarterly growth of 0.8 per cent.
With Canadian data limited before the weekend, further GBP/CAD movement could also be triggered by Bank of England Governor Mark Carney’s speech, taking place at 17:45 GMT.
Current Canadian Dollar (CAD) Exchange Rates:
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The Canadian Dollar/US Dollar Exchange Rate is currently in the region of: 0.9612 <
The Canadian Dollar /Euro Exchange Rate is currently in the region of: 0.6959 <
The Canadian Dollar/Pound Sterling Exchange Rate is currently in the region of: 0.5945 <
The Canadian Dollar/Australian Dollar Exchange Rate is currently in the region of: 1.0022 >
The Canadian Dollar /New Zealand Dollar Exchange Rate is currently in the region of: 1.1501 >
The Pound Sterling/Canadian Dollar Exchange Rate is currently in the region of: 1.6818 >
The US Dollar/ Canadian Dollar Exchange Rate is currently in the region of: 1.0408 >
The Euro/Canadian Dollar Exchange Rate is currently in the region of: 1.4373 >
The New Zealand Dollar/Canadian Dollar Exchange Rate is currently in the region of: 0.8728 >
The Australian Dollar/Canadian Dollar Exchange Rate is currently in the region of: 0.9980 <
(Correct as of 14:45 GMT)
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