The Pound climbed to a four-and-a-half year high against the Canadian Dollar on Thursday as the Canadian currency continued to be weakened by yesterday’s dovish speech by Bank of Canada Governor Stephen Poloz and last night’s US Federal Reserve meeting.
The ‘Loonie’ was weakened earlier in the week by Stephen Poloz’s comments that interest rates in Canada are likely to remain low in order to keep the country’s economy growing. The currency began its sharp declines following a question and answer session in a speech to bankers on Tuesday; Poloz said that a rate cut by the Bank of Canada could not be ruled out as a stimulus measure.
Sterling found support earlier in the session from positive manufacturing orders data.
The Canadian Dollar to US Dollar (USD/CAD) exchange rate tumbled to a four and a half year low as economists raised their bets that the Federal Reserve could raise interest rates by as soon as next year. New Federal Reserve Chairman Janet Yellen said that the Central Bank could begin to increase rates six-months after the end of its monthly bond buying programme, which is expected to finish later this year.
Also giving support to the US currency over its Canadian relation was the publication of a report which showed that initial jobless claims in the USA rose less-than-expected last week to remain close to a four-month low.
The Department of Labour reported that the number of people filing for initial jobless benefits in the week ending March 15 rose by 5,000 to 320,000 from the previous week’s total of 315,000. Analysts had expected jobless claims to rise by 10,000 last week.
The U.S. economic recovery has pulled money out of other markets around the world; including Canada’s and is partly responsible for the falling Canadian Dollar
Against the Euro the ‘Loonie’ slid to a five-year low.
Canadian Dollar (CAD) Exchange Rates
[table width=”100%” colwidth=”50|50|50|50|50″ colalign=”left|left|left|left|left”]
Currency, ,Currency,Rate ,
Canadian Dollar,
,Pound Sterling,0.5383 ,
Canadian Dollar,,US Dollar,0.8878 ,
Canadian Dollar,,Euro,0.6451 ,
Canadian Dollar,,Australian Dollar,0.9836 ,
Pound Sterling,,Canadian Dollar,1.8586 ,
[/table]
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