The Canadian economy received a welcome boost following an upward revision of its growth expectation for 2018. The following Canadian Dollar report discusses this in further detail, with an update to the current NAFTA negotiations. The below shows the difference in GBPCAD exchange rates during the high and low trading points for the past month.

Currency Pair% ChangeDifference on £200,000
GBPCAD2.5%CAD $8,660

The revised growth estimate was to 2%, up 0.2% on the previous figure.

Despite this improved outlook, figures for 2019 are expected to show a retraction to 1.8%, as an expected slowdown in global trade is predicted to have a negative impact on all the export driven economies, including Canada’s.

In truth, the CAD has been under pressure for some time. The negative media focus surrounding their failure to secure a NAFTA agreement with the US is not helping to drive support for the CAD, which has seen its value plateau against Sterling in recent days and drop further against the USD.

Will Canada secure a new NAFTA deal with the US?

Will Canada secure a new NAFTA deal with the US?

Whilst the US and Canada are keen to put a deal in place, President Trump's ruthless approach to negotiations could yet scupper any agreement in the short-term.

It would appear that any revised NAFTA deal may not look as attractive for Canada as its previous tri-deal with the US and Mexico. As such, even when an agreement is reached, the terms of this may not to help drive the CAD’s value back up to its previous highs.

Looking at the Canadian economy, employment growth has weakened significantly of late, with only 213,000 jobs predicted to be added in 2018, compared to the 337,000 created last year.

With the Canadian economy seemingly contracting, there is also the possibility that global trade may slow.

Trump’s trade tariffs are starting to squeeze both the Chinese and Eurozone economies. This in turn will likely minimise investors' risk appetite, which means that commodity based currencies such as the CAD could be sold-off, weakening its value further.

For more information on how future data releases could affect your currency requirement, call our trading floor on 01494 725 353 or email me here.

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Exchange rates on this page are interbank rates and indicate where the market is trading to show the performance of a currency pair. They are not indicative of the rates which we offer. The information on this web site is provided free of charge for information purposes only. It does not constitute advice to any person on any matter. Foreign Currency Direct plc. ("FCD") makes every reasonable effort to ensure that this information is accurate and complete but assumes no responsibility for and gives no warranty with regard to the same.