GBP/CAD Exchange Rate Trends Near February Best despite 13-Month-High for Oil
Despite the highest levels in over a year for Canada’s biggest export, the Pound Sterling to Canadian Dollar (GBP/CAD) exchange rate hit February highs today. The Pound (GBP) continues to benefit from global coronavirus vaccine optimism.
Vaccine optimism has been buoying GBP/CAD higher for weeks, and last week saw the pair climb from the level of 1.7518 to 1.7581.
GBP/CAD continued its advance after markets opened this morning. At the time of writing, GBP/CAD is trending near highs of 1.1721, the best levels for the pair all month.
Key UK and Canadian data could influence Pound to Canadian Dollar exchange rate movement later in the week. For now though, shifts in sentiment will remain the focus.
Pound (GBP) Exchange Rates Keep Rallying on Market’s Coronavirus Vaccine Optimism
The Pound is keeping up its recent rally, as optimism over recovery from the coronavirus pandemic continues to build. With Britain’s coronavirus vaccine rollout ahead of other major economies, vaccine optimism is boosting the Pound more than other major economies.
While last Friday’s UK growth rate report, this morning’s continued Pound strength is due largely to coronavirus recovery hopes.
The Pound’s performance is impressive, with the currency hitting fresh highs against many other major currencies today.
Canadian Dollar (CAD) Exchange Rates Fail to Beat Pound despite Rising Oil Prices
The Canadian Dollar (CAD) is fairly appealing today, but it has been unable to hold its ground against the more appealing Pound.
Prices of oil, Canada’s biggest export, have hit their best levels in 13 months. Hopes of recovery from the coronavirus pandemic are boosting oil demand speculation.
According to Alexander Novak, Russia’s Deputy Prime Minister, the global oil market is recovering:
‘We’ve seen low volatility in the past few months. This means the market is balanced and the prices we are seeing today are in line with the market situation’
As the Canadian Dollar is often correlated to oil price movement, this news is supporting the Canadian Dollar slightly. However, oil alone has not been enough to boost the Canadian Dollar against the strong Pound.
GBP/CAD Exchange Rate Outlook Likely to Remain Bullish for Now
Unless there is a big downside surprise in the Pound outlook, the Pound to Canadian Dollar exchange rate outlook will likely remain bullish.
Optimism over coronavirus vaccines will continue to benefit the Pound as Britain is on track to be one of the first major economies to be vaccinated.
On top of that, economic data is unlikely to be too influential until later in the week.
Tomorrow will see the publication of Canadian housing starts data, with UK and Canadian inflation rate data following on Wednesday.
However, signs of weakness in UK data combined with further oil prices strength could mean GBP/CAD gains are cut short.
Any surprises in the coronavirus pandemic or vaccination outlook could also impact the direction of the Pound to Canadian Dollar (GBP/CAD) exchange rate outlook.