Although last week’s hawkish comments from Bank of England Governor Mark Carney and today’s better-than-forecast UK housing data saw the Pound enjoy a bullish relationship with its peers for much of European trading, the Canadian Dollar bounced back on surprisingly strong growth data.
The Canadian Dollar Exchange Rate was in the region of 0.6016 against the British Pound as of 14:30 GMT
While US federal shutdown concerns have kept the pressure on higher-risk assets, the ‘Loonie’ was able to climb on its British and US rivals as the domestic economy expanded by 0.6 per cent in July, month-on-month, reversing the previous contraction of 0.5 per cent and defying economists’ expectations for monthly growth of 0.5 per cent.
Year-on-year the Canadian economy grew by 1.4 per cent rather than the 1.3 per cent forecast.
The CAD/GBP exchange rate hit a high of 0.6042
The Canadian Dollar strengthened to 0.9739 against the US Dollar after the data was published.
Foreign exchange strategist Sebastien Galy said of the result; ‘There’s been a significant amount of bearish expectations regarding Canadian growth and overall it’s been a little bit more positive recently. The Canadian Dollar has a tendency to outperform.’
The improvement in output was largely enabled by a return to normal activity following Quebec’s construction strikes and Alberta’s floods.
Separate reports showed an unexpected surge in Canada’s raw materials price index and a 0.2 per cent increase in the nation’s industrial product price.
The raw materials price index climbed 0.9 per cent in August, month-on-month, following an upwardly revised gain of 4.3 per cent. Economists were only expecting an increase of 0.1 per cent.
While further ‘Loonie’ volatility is likely to be inspired by the countdown to the Federal budget deadline, investors will also be looking to the week’s other big Canadian data – the Ivey purchasing managers index, due for release at 15:00 GMT on Friday.
In the days ahead CAD/GBP movement is most likely to be driven by UK data, including manufacturing, construction and services PMI.
Current Canadian Dollar (CAD) Exchange Rates:
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The Canadian Dollar/US Dollar Exchange Rate is currently in the region of: 0.9722 >
The Canadian Dollar /Euro Exchange Rate is currently in the region of: 0.7176 <
The Canadian Dollar/Pound Sterling Exchange Rate is currently in the region of: 0.6016 <
The Canadian Dollar/Australian Dollar Exchange Rate is currently in the region of: 1.0420 <
The Canadian Dollar /New Zealand Dollar Exchange Rate is currently in the region of: 1.1743 >
The Pound Sterling/Canadian Dollar Exchange Rate is currently in the region of: 1.6625 >
The US Dollar/ Canadian Dollar Exchange Rate is currently in the region of: 1.0294 <
The Euro/Canadian Dollar Exchange Rate is currently in the region of: 1.3943 >
The New Zealand Dollar/Canadian Dollar Exchange Rate is currently in the region of: 0.8522 <
The Australian Dollar/Canadian Dollar Exchange Rate is currently in the region of: 0.9602 >
(Correct as of 14:30 GMT)
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