The Pound Sterling to Canadian Dollar (GBP/CAD) exchange rate is currently trending within a tight range on Thursday morning.
Although oil prices have declined near a six-year low, the Canadian Dollar managed to avoid declination. This can be attributed to tracking US Dollar gains after the Federal Reserve hinted towards a rate hike in 2015.
The Pound Sterling, meanwhile, softened fractionally which can be attributed to cooling house prices.
The Pound Sterling to Canadian Dollar (GBP/CAD) exchange rate is currently trending in the region of 1.8951.
Yesterday…
The Pound Sterling to Canadian Dollar (GBP/CAD) exchange rate strengthened by around 0.30% on Wednesday.
After UK growth data printed below estimates on Tuesday, the Pound softened versus the majority of its most traded currency rivals. However, this was somewhat short-sighted as the growth figure for 2014 as a whole was still a seven-year high. Traders have pared the Sterling losses after realising the downtrend was unwarranted.
The Canadian Dollar, meanwhile, is suffering from a sparse economic docket this week. A general downtrend can be attributed to continued declination in the oil market, with the supply glut booming thanks to US output.
The Pound Sterling to Canadian Dollar (GBP/CAD) exchange rate is currently trending in the region of 1.8886.
Pound Sterling (GBP) Exchange Rate Pares Losses on Unjustified Declination
Tuesday’s annual British Gross Domestic Product data was forecast to improve from 2.6% to 2.8% in the fourth quarter, but the actual result only reached 2.7%. This caused the Pound to slump versus the majority of its most traded currency competitors. The pace of growth recorded across the whole of last year was still a seven-year high but was overlooked by many traders. The Pound recovered those losses on Wednesday with a lack of data to provoke changes.
‘With the recent halving of oil prices providing a timely boost to households’ discretionary spending power, credit still becoming cheaper and pay growth on an improving trend… the best days of the UK’s recovery may still lie ahead,’ stated Samuel Tombs of consultancy Capital Economics.
The Pound Sterling to Canadian Dollar (GBP/CAD) exchange rate dropped to a low today of 1.8806.
Canadian Dollar (CAD) Edges Lower on Oil Glut
With a distinct lack of domestic data to provoke changes during the week, the Canadian Dollar has generally softened thanks to volatility in the commodities market. Wednesday’s lower oil prices are weighing on demand for the risk-correlated ‘Loonie’ (CAD).
‘We now expect a long period of oversupply stretching at least into early 2016 and have cut our annual average price forecasts for 2015 by around 40%,’ analysts at Barclays said.
‘There is a much greater degree of uncertainty in the dynamics that will shape the physical crude demand-supply balance and crude pricing than we have seen in recent history,’ said David Hewitt, managing director and co-head of oil research at Credit Suisse.
Pound Sterling to Canadian Dollar (GBP/CAD) Exchange Rate Forecast to Hold Gains
Given the lack of domestic data to spark volatility, and with oil prices showing no signs of recovery, the Pound Sterling to Canadian Dollar (GBP/CAD) exchange rate is likely to hold gains for the remainder of Wednesday.
The Pound Sterling to Canadian Dollar (GBP/CAD) exchange rate climbed to a high today of 1.8955.
