The hefty weight of today’s US news saw the Canadian Dollar slump to an almost six week low against the ‘Greenback’ during North American trading. The ‘Loonie’ also continued to trade lower against the British Pound, despite data showing that the UK posted a surprising July deficit for the first time in three years.
The Canadian Dollar Exchange Rate was in the region of 0.6105 against the British Pound as of 14:20 GMT
While today’s US existing home sales report will be of interest to the CAD/USD pairing, market volatility is most likely to occur after 19:00 GMT and the publication of minutes from the most recent Federal Reserve policy meeting.
As forex expert Blake Jespersen comments; ‘Markets are very focused on the big Fed announcement this afternoon, and that’s pushing the US Dollar higher versus the Canadian Dollar. We believe the Fed will start to taper in September and therefore we do expect the Canadian Dollar to weaken down to C$1.06, C$1.07 in the next month or two.’
The CAD/GBP exchange rate hit a low of 0.6097
The majority of analysts participating in a Bloomberg survey are expecting the ‘Loonie’ to weaken to C$1.05 by the end of the year, with Jespersen stating: ‘We’re seeing a good bit of selling at these levels, and short positions building up by central banks.’
As the week progresses market movement will be largely dictated by the FOMC meeting minutes and whether or not the central bank offers a potential timeline for the tapering of quantitative easing.
However, CAD/GBP movement could also be effected by tomorrow’s Canadian retail sales report.
Economists have forecast that retail sales declined by 0.5 per cent in June after climbing by 1.9 per cent in May. If this estimate proves accurate it will be another sign of Canada’s patchy economic recovery.
Current Canadian Dollar (CAD) Exchange Rates:
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The Canadian Dollar/US Dollar Exchange Rate is currently in the region of: 0.9581 <
The Canadian Dollar /Euro Exchange Rate is currently in the region of: 0.7158 <
The Canadian Dollar/Pound Sterling Exchange Rate is currently in the region of: 0.6105 <
The Canadian Dollar/Australian Dollar Exchange Rate is currently in the region of: 1.0615 <
The Canadian Dollar /New Zealand Dollar Exchange Rate is currently in the region of: 1.2059 >
The Pound Sterling/Canadian Dollar Exchange Rate is currently in the region of: 1.6377 >
The US Dollar/ Canadian Dollar Exchange Rate is currently in the region of: 1.0437 >
The Euro/Canadian Dollar Exchange Rate is currently in the region of: 1.3972 >
The New Zealand Dollar/Canadian Dollar Exchange Rate is currently in the region of: 0.8255 <
The Australian Dollar/Canadian Dollar Exchange Rate is currently in the region of: 0.9420 >
(Correct as of 14:20 GMT)
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