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 when buying £200,000 at the high compared to the low for the past week.
|Currency Pair||% Change||Difference on £200,000|
This week one of the most anticipated data releases will be the Bank of Canada’s interest rate decision. Last week the BoC Governor Stephen Poloz suggested that low interest rates had now done their job raising speculation that an interest rate hike is coming.
At 16.00 on Wednesday a statement will be released and I believe they will raise interest rates from 0.5% to 0.75%. Last week the latest trade data in Canada showed record levels for both imports and exports for the month of May. Furthermore, the Canadian economy has bounced back from the low oil prices seen this time last year.
The release will be followed by a press conference from Poloz who will provide the monetary policy committee’s thoughts. If there wasn’t to be an interest rate hike then it’s likely he would set up a rate hike at the next meeting. The GBP/CAD rate has recently dropped to a three-month low, mainly down to the uncertainty surrounding Sterling.
If there was to be an interest rate hike this week there could be opportunity for the GBP/CAD to fall further. Currently residing around the 1.65 level I wouldn’t be surprised to see a drop to the low 1.60’s. The last time the Bank of Canada changed the interest rate was in 2015 where they cut twice, therefore investors will be very optimistic for the future if there was a hike.
If you have a requirement to purchase Canadian Dollars doing so before the rate decision could make a major difference. If there wasn’t to be a rate hike you may benefit from taking a risk however it could result in a big loss. If you do have a requirement contacting your broker could mean they can discuss what might be the best option to take depending on your plans.
Thank you for reading today’s CAD report, I would greatly appreciate any feedback you have and would take pleasure in replying personally. I am more than happy to assist you with any of your currency requirements. feel free to get in touch here.
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