This Canadian Dollar report will examine the factors that could affect exchange rates this week in order to help you stay informed if you need to make a currency transfer. The table below shows the difference you would have received in CAD when buying £200,000 at the high compared to the low for the past 30 days.
|Currency Pair||% Change||Difference on £200,000|
Sterling looked to be closing the month on a high against the Loonie as the export dependant currency continued to suffer from a fall in demand for North American oil as Hurricane Harvey’s devastation halted production. The pound had gained by almost 1.8% since the start of the week until a run of extremely positive economic data for the Canadian Dollar yesterday. Canada’s GDP rose by almost 4.5% in the second quarter, smashing through Statistics Canada’s forecast of 3.7%, thanks to a surprising increase in household spending. That is the 4th consecutive quarterly rise, a feat that hasn’t happened since 2006. Thriving thanks to solid employment market and a continued rise in Real estate value, Canadian households were consuming 4.6% more this quarter. Household savings also rose to 4.6%.
With the Canadian economy continuing to perform so well these recent figures will have only further cemented the Bank of Canada’s acceptance to raise rates. The question is, when will they make that stride? Since yesterday’s release, the odds on a rate hike as early as next Wednesday have jumped from 27% to 41%. By raising interest, the BoC would make the Canadian dollar a far more attractive currency for international investors, as such the Loonie may become a lot more expensive to buy in the second half of next week. GBP/CAD rates haven’t been below the 1.60 level since January but given the uncertainty surrounding the UK economy at the moment, I wouldn’t be surprised if the Loonie uses its momentum and tests this level. If you have a GBP/CAD requirement, it may pay to make a move before this event.
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