President Trump's recent comments about the price of oil being artificially inflated by OPEC caused the price of oil to fall, which could be a cause for concern as an economy relies heavily on exports, of oil in particular. The table below shows the difference in Canadian Dollars you could have achieved when buying £200,000.00 during the high and low points of the past week.
|Currency Pair||% Change||Difference on £200,000|
Stephen Poloz, the head of the Central Bank in Canada will this evening deliver a speech. Stephen Poloz is expected to make reference to the current North American trade agreement talks and the current economic conditions in Canada. These two subjects are likely to create movement on Canadian Dollar exchange rates.
Poloz has been cautious in the last few weeks suggesting he won’t raise interest rates without there being a clear indication it will have a positive effect on the economy. Last year the Bank of Canada raised rates with little warning and they had an immediate positive effect on the Canadian Dollar, however the same surprise doesn’t look likely to take place due to concerns over global trade and the North American Free Trade Agreement.
Currently there is significant uncertainty for Canada as the trade agreement with the US and other American economies is still up in the air, however at this point Trump has avoided imposing any of the tariffs that have been placed on other Global economies. If he alludes to this I would expect the CAD to weaken.
Donald Trump this past week has turned his attention to the price of oil after in his words he believes the OPEC nations are artificially inflating the price of oil. Trump has suggested that there is huge amounts of oil available and any sudden increase in the price are not natural due to huge amount of supply. This could eventually have an effect on the Canadian Dollar as Canada’s main export comes under pressure from external factors. The value of a barrel of oil did in fact fall last week after Trump made the comments.
In the past 12 months most things the President has turned his eye to have seen some form of influence and oil could well be next. If you’re in the market for buying or selling Canadian Dollars make sure you’re in contact with your broker as rates could be set to enter a volatile period.
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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