Having steadily declined throughout the course of the European session; the Pound to Canadian Dollar exchange rate has started to appreciate after Canadian data printed disappointingly. The Pound Sterling, however, is still struggling to shrug off negative sentiment amid fears of overvaluation.
The Pound Sterling to Canadian Dollar exchange rate is currently trending in the region of 1.7979.
Over the past few days the Pound has generally depreciated against the majority of its most traded currency competitors. This is as a result of dovish speeches made by the Business Secretary and Bank of England officials.
Bank of England Deputy Governor Ben Broadbent stated that he feels the UK isn’t ready for a rate increase until issues with inflation are addressed. Similarly, the newest BoE policymaker Kristin Forbes parroted Broadbent’s views and stated that inflation has hampered economic growth.
On Tuesday Sterling experienced further depreciation after Business Secretary Vince Cable suggested that the inflationary issues were as a result of a Pound which is around 10-15% overvalued.
Having gained a healthy boost from Monday’s Ivey Purchasing Managers Index, the Canadian Dollar lost those gains on Tuesday. Canadian Building Permits were expected to contract by around -6.5%, having shown healthy growth of 11.6% previously, but the actual result showed a reduction by a massive -28.3%.
The Pound Sterling to Canadian Dollar exchange rate has fallen to a low today of 1.7924.
Wednesday’s British data has printed relatively positively, although it hasn’t proved to be enough to overshadow concerns of overvaluation.
The 3-monthly Halifax House Prices met with the median market forecast of a slight drop from 9.7% to 9.6%. Monthly house prices showed a rise of 0.6% in September; 0.4% higher than the market consensus.
Perhaps one contributing factor to a flagging Sterling was the BRC Shop Price Index which declined from -1.6% to -1.8%.
Canadian data on Wednesday has been less-than-ideal which has caused a fractional ‘Loonie’ (CAD) downtrend. Canadian Housing Starts were forecast to rise from the revised figure of 196,300 to 198,000, but the actual result showed a smaller increase to 197,300.
Forecast for the Pound to Canadian Dollar Exchange Rate
Thursday’s economic calendar houses some interesting British publications. The BoE Asset Purchase Target is expected to remain unchanged from 375 billion. The BoE Rate Decision is also forecast to remain unchanged although there is a small possibility that the Governor Mark Carney will seek to tighten monetary policy.
Canadian data on Thursday will be of less consequence in terms of the provocation of market movement. The yearly New Housing Price Index is forecast to increase a little from 1.4% to 1.5%.
The Pound Sterling to Canadian Dollar exchange rate has reached a high today of 1.8002.
UPDATE
The Pound Sterling to Canadian Dollar exchange rate is currently trending in the region of 1.7957.
The minutes from the most recent Federal Reserve policy meeting were particularly dovish. This caused the US Dollar to decline and the Canadian Dollar has followed suit.
Anxieties concerning slow global economic growth and an overvalued US Dollar dominated policymaker focus, and the Fed called for patience regarding the timing of a bank rate increase.
Sterling has generally depreciated against the majority of its most traded currency competitors as House Price Balance slumped, and as traders await the Bank of England rate decision.
