The Pound Sterling to Canadian Dollar (GBP/CAD) exchange rate is currently trending around 1.8259, moving between a low of 1.8233 and a high of 1.8394. Movement is around -0.56% as a result of poor UK weekly wage statistics and a dovish Bank of England (BoE) Inflation Report.
Following Monday’s steep declines for the Pound to ‘Loonie’ (CAD) exchange rate, yesterday saw the Pound claw back its losses and the GBP/CAD pairing posted a slight gain at the close of the session. This was helped by a sparse economic calendar which had little data for either currency.
Today was very different in terms of the domestic data releases pertaining to the UK. The ILO Unemployment Rate posted a positive result having remained faithful to the forecast figure of 6.4%. This positive result has been somewhat micrified, however, with a less than satisfactory average weekly earnings figure. Year-on-year Average Weekly Earnings was forecast to drop to -0.1% from the previous figure of 0.4%. This declination would have been dramatic enough, but the actual result revealed a drop to -0.2%. The lack of correlation between weekly earnings and unemployment had an immediate effect; softening the Pound against most other currencies.
To add icing to an increasingly bad tasting cake; the Bank of England Inflation Report was dovish. It transpired that the committee were not prepared to move on their current monetary policy…a policy which has been unchanged since 2009. The inflation report coupled with the poor labour market data has lain to rest any speculation for an interest rate hike before the end of 2014.
The ‘Loonie’ has maintained relatively steady movement since Monday having had no domestic data releases. Today’s Teranet/National Bank HPI should have very little influence in terms of movement for the Canadian Dollar.
The Pound Sterling to Canadian Dollar (GBP/CAD) exchange rate has hit a low today of 1.8233.
Pound Sterling to Canadian Dollar Exchange Rate Forecast
Tomorrow’s economic calendar is relatively uneventful from a UK economic standpoint.
For those invested in the Canadian Dollar, tomorrow’s year-on-year New Housing Price Index will be of interest. There is currently no forecast figure.
Friday will see some important data for both the UK and Canada.
The UK Gross Domestic Product (GDP) Report will be of vital consequence from a UK economic perspective, and is very likely to arouse movement for the Pound. It is currently forecast at 3.1% which is the same as the previous figure posted. Those invested in Sterling will hope for a better than forecast result in order to repair today’s damage.
From a Canadian economic standpoint Friday’s Existing Home Sales Report will hold some weight. There is currently no forecast figure. However, should it rise from the previous figure of 0.8% the Canadian Dollar should be bolstered as a result.
The Pound Sterling to Canadian Dollar exchange rate hit a high today of 1.8394.
Pound to Canadian Dollar Feels the Effect of Dovish BoE Inflation Report
Yesterday’s abysmal UK labour market data spelled disaster for Sterling. The problems mounted after the release of a dovish Bank of England inflation report, in which Governor Mark Carney intimated at a shift in focus from unemployment to wage growth. The report has all but quashed any speculation of an interest rate hike in the second half of the year.
With very little domestic data pertaining to either currency expect the exchange rate to continue on this downward trend. Today’s Canadian New Housing Price Index may have some impact on the ‘Loonie’ (CAD); but will have little influence on the Pound Sterling to Canadian Dollar exchange rate whilst traders continue to pull away from the Pound.
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