The Pound Sterling to Euro (GBP/EUR) exchange rate registered losses in Tuesday’s European session despite the situation in Greece turning from bad to worse, while the Pound Sterling to Canadian Dollar (GBP/CAD) exchange rate was able to trend higher on commodity-inspired currency weakness.
Crude Oil Glut Forecast to Continue – Canadian Dollar (CAD) Exchange Rate Soft
The price of oil has a massive impact on the way in which the Canadian Dollar (CAD) trades as crude oil is Canada’s largest commodity. It’s highly possible that the global oil glut we’re currently experiencing could be the longest in the past three decades and it has the potential to drag on for some time.
OPEC Oil Output Increase, Iran Deal Forecast to Keep Crude Prices Lower and Pressure CAD/EUR, CAD/GBP Exchange Rates
The Organisation of Petroleum Exporting Countries (OPEC) has been aiding falling oil prices by increasing output despite it exceeding global demand. Additionally, the possibility of a nuclear deal with Iran by the end of the month could see the nation introduce more oil into the market if Western sanctions are lifted.
Commerzbank commodity researcher Eugen Weinberg commented: ‘It seems to be taking longer for the oil surplus to clear, and, even without the return of Iran, IEA data indicates it could last for the rest of the year. Any expectations the oversupply will be gone by 2016 don’t look justified at this stage.’
Meanwhile, Canadian data also disappointed on Monday with the nation’s Manufacturing Shipments ecostat coming in at -2.1% in April on the month, rather than the -0.5% forecast. Economists are now suggesting that Canada’s second quarter may not have been as fruitful as initially predicted.
The Canadian Dollar to Euro (CAD/EUR) exchange rate is trending at 0.7202.
The Canadian Dollar to Pound Sterling (CAD/GBP) exchange rate is trending at 0.5211.
Euro (EUR) Exchange Rate Forecast: EUR/GBP, EUR/CAD Predicted to Sink if Greek Default becomes Reality
After months of rather uneventful talks, (well, they’ve been full of bickering but no real progress has been made), negotiations between Greece and its creditors appear to be breaking down rather catastrophically.
Now investors in the Euro (EUR) exchange rate are looking towards Thursday’s Eurogroup meeting for progress between the two sides. However, at this point it’s fair to say a swift agreement is unlikely , leading many industry experts to predict that a ‘Grexit’ could be on the cards.
Industry expert Peter Spiegel commented: ‘Eurozone officials are discussing holding an emergency summit on Sunday for leaders to tackle the crisis in Greece amid mounting fears a deal to break an ongoing impasse between Athens and its bailout creditors will not be reached at a high-stakes finance ministers meeting on Thursday.’
It’s also worth bearing in mind we’re half way through the month and Greece’s current austerity deal runs out at the end of June.
The Euro to Canadian Dollar (EUR/CAD) exchange rate is trending at 1.3897.
The Euro to Pound Sterling (EUR/GBP) exchange rate is trending at 0.7234.
Pound Sterling to Euro (GBP/EUR), Pound Sterling to Canadian Dollar (GBP/CAD) Exchange Rate Forecast: BoE Minutes Ahead
The Pound Sterling to Euro (GBP/EUR) and Pound Sterling to Canadian Dollar (GBP/CAD) exchange rates are forecast for some major fluctuations on Wednesday with the release of the Bank of England’s (BoE) meeting minutes. The minutes are expected to detail the votes for and against interest rate hikes in the UK.
At the past several meetings, two members have found the decision ‘finely balanced’ indicating that a policymaker divergence may be on the cards this month.
The UK’s Consumer Price Index (CPI) managed to step out of deflation waters on Tuesday, rising from -0.1% to 0.1% in May on the year. Additionally, the core measure of inflation rose from 0.8% to 0.9% in May, a little below the 1.0% forecast but still an improvement.
The Pound Sterling to Canadian Dollar (GBP/CAD) exchange rate is trending at 1.9218.
The Pound Sterling to Euro (GBP/EUR) exchange rate is trending in the region of 1.3827.