GBP/CAD Conversion Rate Predicted to Trend Narrowly on UK Housing Bubble Fears
The Pound Sterling to Canadian Dollar (GBP/CAD) exchange rate was trending within a limited range on Monday afternoon.
Rightmove House Prices in November advanced by 6.2% on the year. This exacerbated fears that the UK will be subject to a serious housing bubble and first time buyers will be priced out of the market. On the month, November’s Rightmove House Prices contracted by -1.3% but the slump is predicted to be short-lived. ‘It’s likely to be a short-lived respite as the combination of high confidence and low interest rates is a recipe for higher prices,’ said Rightmove Director Miles Shipside.
‘I understand it is a pretty rough market for a first time buyer but you have to look at what you define as a bubble,’ said Simon Rubinsohn, chief economist at RICS, to Business Insider. ‘The UK housing market is not in a classic bubble. There is no upsurge in people taking out credit — we don’t have that at the moment. Credit availability is controlled and loan-to-value ratios are no longer available at 100%, like we’ve seen in past episodes. The primary driver is a supply issue. This is not a classic condition for a bubble.’
The Pound Sterling to Canadian Dollar (GBP/CAD) exchange rate is currently trending in the region of 2.0320.
CAD/GBP Exchange Rate Forecast to Experience Limited Movement Despite Positive Canadian Home Sales Data
In the early stages of Monday’s European session crude oil prices surged amid speculation of heightened demand as France launched airstrikes on Syria. However, as the session progressed the price of oil slid significantly as the global supply glut continues to weigh. ‘That both crude oil and combined crude and product stocks are near record levels is a reason for concern,’ Barclays bank said in a research note. ‘Our outlook is skewed negative into (the first half of next year). Macro headwinds remain, crude oil inventories are building,’ Morgan Stanley said.
Canadian economic data produced a mixed-bag of results today, although the drop in crude prices and heightened demand for safe-haven assets overshadowed domestic data. September’s Monthly Manufacturing Shipments contracted by -1.5% despite predictions of a 0.2% increase. September’s CAD International Securities Transactions dropped from 5.78 billion to 3.35 billion. October’s Existing Home Sales advanced by 1.8% on the month, bettering the previous figure of -2.1% considerably.
The Pound Sterling to Canadian Dollar (GBP/CAD) exchange rate dropped to a low of 2.0199 during Monday’s European session.
Pound Sterling to Canadian Dollar (GBP/CAD) Exchange Rate: Volatility Forecast on UK Inflation Data
Tomorrow is likely to see significant Pound Sterling to Canadian Dollar exchange rate volatility upon the publication of British inflation data. The Bank of England (BoE) Monetary Policy Committee (MPC) have already highlighted the lack of price pressures as one of the principle stumbling blocks preventing an immediate cash rate increase. A better-than-anticipated result could call into question the particularly dovish quarterly inflation report recently published by the BoE.
With a complete absence of Canadian economic data on Tuesday to provoke changes, the ‘Loonie’ (CAD) is likely to see movement in response to crude oil prices, trader risk-appetite and US Dollar positioning.
The Pound Sterling to Canadian Dollar (GBP/CAD) exchange rate reached a high of 2.0326 during Monday’s European session.
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