The Canadian Dollar has continued its fine run of form this week against the Pound, with the most recent retail sales figures for September showing a huge increase compared to August. This week so far we have seen the CAD gain by as much as 1.5% against the Pound, which in monetary terms would mean an extra $5,000 on a £200,000 transfer. It’s not been all plain sailing this year for the CAD however, with the Canadian economy struggling for much of 2016 and the falling price of oil has certainly not helped the Loonie’s cause.
As a net exporter of oil, the Canadian economy is heavily reliant on a strong oil price, so with the lack of any kind of curb on oil production, cheap oil has been easy to come by.
That could be all about to change however, with oil prices beginning to show signs of life this week on the back of some confidence from the markets that it is looking like there could be a limit to oil output agreed at the OPEC (Organisation of Petroleum Exporting Countries) meeting on November 30th next week. There have been hints from some of the organisation’s member this week including Iran and Russia that they are edging closer to securing a deal, whilst Goldman Sachs have also said that they believe we are on the brink of a deal which would mean the global oil surplus could become a deficit by the middle of 2017.
If the rumours are to be believed and a compromise is reached next week then we could see some significant Loonie strength. As a result any clients looking to buy CAD may be wise to move sooner rather than later to secure their currency. We have a number of options here that can allow you to do this, so please contact your account manager here at your earliest convenience.
With the price of oil set to rise if OPECs meeting is a success, clients holding Sterling to buy the Canadian Dollar may benefit from talking through your requirements with an experienced broker. Call our trading floor on 01494 725 353 or email me here.