With the price of oil and stockpiles falling, the Canadian Dollar should begin to pick up in the weeks to come.
Yesterday EIA crude oil stocks came in much lower than expected. The EIA Crude Oil stockpiles report is a weekly measure of the change in the number of barrels in stock of crude oil. As a commodity currency, the CAD is heavily linked to the demand of oil. If the increase in crude oil is more than expected, it implies weaker demand and is bearish for crude prices. The same can be said if a decline in oil is less than expected.
This result should have helped to strengthen the CAD against GBP yesterday, however much stronger than expected employment data from the UK overweighed this. Furthermore, the UK has started to settle politically, which could help to strengthen Sterling against the Canadian Dollar in the short term.
On Friday, CPI – both Retail Sales figures and the Consumer Price Index will be released for the month, followed by the yearly data release. CPI is a measure of inflation and both data releases are expected to show a drop from the previous figure. We could potentially see Sterling begin its fightback this week if talks with France go as well as they did with Germany, and with poor data expected on Friday – CAD buyers could have a good opportunity to take advantage of.
If you are thinking about transferring your money, there are a number of options available to you. A very popular choice at the minute with our clients is a ‘forward contract’ – this allows you to lock in a rate of exchange for up to a year in advance, eliminating any volatility and avoiding any substantial losses. To find our more and hear how a forward contract could benefit you, please get in touch with Currencies.co.uk today.
For more information on how future data releases could affect your currency requirement, call our trading floor on 01494 725 353.
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