Canadian Dollar to British Pound (CAD/GBP) Exchange Rate Awaits BoE Interest Rate Meeting
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The CAD to GBP currency pairing is trending between the 0.5433 and 0.5444 boundaries on Monday.
In a relatively quiet week for Canadian data publishing the ‘Loonie’ will see influence on Friday by way of Net Change in Employment, Unemployment Rate and Full Time Employment Change figures.
Whilst the Canadian Unemployment Rate is presently forecast to stagnate at the current 7.1%, Change in Employment numbers are expected to show the creation of 24.0K jobs.
The Bank of Canada (BoC) recently decided to allow the Canadian interest rate to remain at the current 1.0%, which it has stagnated at for the latter four years.
However, the Canadian economy has recently seen economists questioning the time frame regarding interest rate hikes.
Economist Bill Adams stated: ‘Both the Bank of Canada and the Federal Reserve are gingerly avoiding spooking markets hinting too suddenly at a rate hike on the horizon, but it is obviously out there. We expect an initial hike in Canada in the third quarter of 2015, just ahead of the Fed’s first hike in October 2015.’
Conversely the UK economy is also shrouded in anticipation regarding interest rate hikes. All eyes are currently following the Bank of England’s Thursday meeting which will discuss the current interest rate timeframe.
Governor for the Bank of England (BoE), Mark Carney, is treading carefully with regards to rate rises. After somewhat ambiguous messages from the BoE, Carney has stated any hikes will be slow, gradual and dependent on the UK data.
Expert in the field Richard Scrope commented: ‘Mark Carney will have to think long and hard before he does increase rates. There are some concerns about what that would do to the UK economy and the housing market, there’s a lot of debt riding on mortgages at the moment.’
The Pound may also gain this week following the publication of highly favourable Construction PMI figures which have shown production in UK house building reached higher than expected levels; the figure totalled 62.4 above the forecast 62.0.
The CAD to GBP exchange rate will remain subject to volatility this week as the currency market watches the BoE meeting unfold. However, with influential data releases for Canada occurring this week also, the ‘Loonie’ may be able to retain some stability in the pairing.
The Pound to Canadian Dollar exchange rate is presently residing at 0.5435.