British Pound to Canadian Dollar (GBP/CAD) Exchange Rate Rallies, CAD/USD Holds Declines
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At the close of last week the ‘Loonie’ lost ground as a result of below-forecast employment reports for both the US and Canada.
US non-farm payrolls detailed a jobs gain of 142,000, shy of forecasts and the lowest employment increase for six months.
Meanwhile, the Canadian economy was shown to have shed 11,000 positions.
The CAD/USD exchange rate eased lower and largely held declines over the weekend.
The commodity-driven Canadian Dollar fluctuated modestly on Monday in response to China’s latest trade report and the news that the price of Brent crude oil, a major Canadian export, fell below the 100 Dollars a barrel mark for the first time since the middle of last year.
According to industry expert John Kilduff; ‘Global oil demand remains soft. China’s imports being down are another sign of softening. Any sign of a slowdown there has a major impact on the market.’ China’s imports were shown to have fallen by 2.4% in August.
The Pound Sterling to Canadian Dollar (GBP/CAD) exchange rate hit a high of 1.7638
However, while the Canadian Dollar to US Dollar exchange rate hovered around the day’s low of 0.9168, the ‘Loonie’ capitalised on underlying Pound weakness.
A YouGov poll surprised investors by showing that separatists now have the lead on the issue of Scottish independence, a result which caused extensive Sterling losses.
The GBP/CAD exchange rate held declines as Canadian building permits unexpectedly jumped in July.
The number of permits issued in June was positively revised to 16.4% and permits increased by a further 11.8% in July, month-on-month instead of declining by -8.5%. Toronto and Vancouver were responsible for the largest increases in building permits.
In the view of economist Krishen Rangasamy; ‘Low interest rates and an improving economic outlook are seemingly encouraging builders to apply. It’s unclear, however, if all those permits will translate into actual construction in the multi category where there is reported excess supply in some cities.’
Bloomberg News Agency published a separate Canadian report. The Bloomberg Nanos Canadian Confidence Index rose from 59.0 to 59.1 in the week ending September 5th, higher than the year average of 58.9.
Pound Sterling to Canadian Dollar (GBP/CAD) Exchange Rate Forecast
The economic calendar is looking a little sparse this week, but Canadian reports to be aware of over the next few days include the nation’s Housing Starts figures (out tomorrow), Capacity Utilisation Rate for the second quarter (out on Wednesday) and Canada’s New Housing Price Index for July (scheduled for release on Thursday).
GBP/CAD exchange rate movement could also be triggered by the UK’s news, in particular tomorrow’s trade data and the National Institute of Economic and Social Research’s GDP estimate for August. It will take encouraging UK developments for the Pound to recover the losses sustained at the outset of the week.
The Canadian Dollar is trading against the Pound in the region of 0.5668 and against the US Dollar in the region of 0.9168.
The Pound to Canadian Dollar exchange rate recouped some of its recent losses on Tuesday as several UK reports exceeded expectations and Bank of England Governor Mark Carney offered some fairly optimistic commentary on the domestic economy.
The GBP to CAD exchange rate advanced by over 0.2% and held its advance as Canadian housing starts fell short of expectations. Tomorrow movement in the Pound to Canadian Dollar exchange rate could be caused by commentary from several BoE officials, including Mark Carney, David Miles and Martin Weale.