The Pound Sterling to Canadian Dollar (GBP/CAD) exchange rate softened by around -0.19% on Tuesday morning.
The British Construction PMI, due for publication later on Tuesday morning, is the only UK data publication on Tuesday. Therefore it is likely to be the driving force behind Sterling movement.
The Canadian Dollar, meanwhile, strengthened as a result of oil prices nearing $50 a barrel. Additional appreciation can be attributed to Canadian growth data expected to improve over the previous figure.
The Pound Sterling to Canadian Dollar (GBP/CAD) exchange rate is currently trending in the region of 1.9224.
Yesterday…
The Pound Sterling to Canadian Dollar (GBP/CAD) exchange rate declined by around -0.30% on Monday afternoon.
As we approach the British general election, in which political uncertainties has intensified trader caution, the Pound softened versus many of its most traded currency counterparts. Further declination is thanks to varied results from domestic data.
The Canadian Dollar, meanwhile, strengthened versus many of its major peers despite disappointing results from domestic ecostats. The ‘Loonie’ (CAD) advance is a result of rising oil prices and speculation that the Bank of Canada (BOC) will forgo further rate cuts.
The Pound Sterling to Canadian Dollar (GBP/CAD) exchange rate is currently trending in the region of 1.9267.
Pound Sterling (GBP) Exchange Rate Edges Lower ahead of General Election
As described above, trader caution with regards to Sterling investment has been amplified as we draw nearer to the general election. Fears that whoever gains victory will introduce a European Union referendum is weighing heavily on the Pound.
Additional losses can be attributed to disappointing data after House Prices, Mortgage Approvals, Net Consumer Credit and Net Lending on Securities all failed to meet with median market forecast figures. The Manufacturing PMI, however, did advance beyond expectations reaching 54.1.
Chris Williamson, Chief Economist at Markit said; ‘Manufacturing braved the cold weather in February, reporting an upturn in the pace of growth. A flurry of activity towards the month end helped raise production to a greater extent than signalled by the earlier flash reading. The upbeat survey points to minimal impact from the adverse weather that affected many parts of the country during the month.’
The Pound Sterling to Canadian Dollar (GBP/CAD) exchange rate has fallen to a low today of 1.9203.
Canadian Dollar (CAD) Exchange Rate Advances on Oil Prices
Canadian data printed poorly on Monday, but the ‘loonie’ advanced irrespectively. Of particular disappointment was the Manufacturing PMI which dropped below the 50 mark which separates growth from contraction.
‘February’s data reflect the hit to confidence from the oil price shock with the weakness most evident in the energy-intensive regions of the country,’ said chief economist Craig Wright of Royal Bank of Canada.
Oil prices strengthened on Monday which resulted in increased demand for the Canadian Dollar. The higher oil prices have been linked to US oil supply not meeting expectations.
Pound Sterling to Canadian Dollar (GBP/CAD) Exchange Rate Forecast to Fluctuate
Although the Pound Sterling to Canadian Dollar (GBP/CAD) exchange rate is likely to hold losses, there is potential for fluctuations as oil prices remain volatile. Tuesday will see heightened GBP/CAD movement with British construction data and Canadian growth data due for publication.
The Pound Sterling to Canadian Dollar (GBP/CAD) exchange rate reached a high today of 1.9323.
