GBP/CAD Exchange Rate Falls as No-Deal Brexit Doubts Creep Back
The Pound Canadian Dollar (GBP/CAD) exchange rate is down today and is currently trading around $1.7646 on the inter-bank market.
Sterling (GBP) fell against the Canadian Dollar (CAD) following last night’s parliamentary vote on a no-deal Brexit, which was voted down by a majority of 43. Today, meanwhile, will see a vote on a possible extension of Article 50, which could see Brexit delayed until the 30 June.
The Pound has continued to weaken after yesterday’s 21-month high following the vote. This has occurred due to the vote being non-binding which means, technically, that the no-deal still remains on the table – haunting market confidence in Sterling today.
Prime Minister Theresa May concluded last night’s vote with a warning to MPs, saying:
‘The options before us are the same as they always have been. The legal default in EU and UK law is that the UK will leave without a deal unless something else is agreed. The onus is now on every one of us in this House to find out what that is.’
The Canadian Dollar, meanwhile, has gained on the weakened Pound today as ‘Loonie’ traders await the publication of the Canadian New Housing Price Index figures for January, which are expected to remain flat at 0%.
Today will also see the Bank of Canada’s Senior Deputy Governor, Carolyn Wilkins, deliver a speech, and with any bullish comments about the Canadian economy, this could see the CAD/GBP exchange rate rise further.
GBP/CAD Exchange Rate Falls as MPs Wrestle for Control of Brexit
The Pound continues to be troubled by the possibility of a no-deal emerging if the EU is not forthcoming with a clear outline for an extension to Brexit.
The President of the European Council, Donald Tusk, tweeted this morning:
— Donald Tusk (@eucopresident) March 14, 2019
However, Theresa May is coming under increasing pressure from MPs across both parties, who are attempting to take control of Brexit in an attempt to push forward with votes on all of the options available.
This amendment, which allows MPs control over the Brexit outcome, was put forward by the former Tory MP Sarah Wollaston – who is now a member of the Independent Group – and has gained the backing of approximately 30 MPs.
Today, meanwhile, saw the publication of the UK RICS housing price balance figures for February, which fell to -28%, although Brexit developments have generally overshadowed economic data.
GBP/CAD Forecast: Pound Could Sink Further on Lack of Consensus in Parliament
The Canadian Dollar is likely to remain sensitive to any domestic political developments surround Prime Minister Justin Trudeau who is coming under increasing scrutiny following a scandal which has bought forward a federal case over interference with the Montreal-based construction company, SNC-Lavalin.
Any signs that this could lead to an impeachment of Trudeau could see political volatility weaken the Canadian Dollar.
Tomorrow, meanwhile, will see the publication of the Canadian manufacturing shipments figures for January, which are expected to improve.
The GBP/CAD exchange rate will likely be dictated by Brexit developments into next week, and with tonight’s vote on an extension to Brexit likely to succeed, the next steps of securing a consensus within Parliament could further weaken Sterling.