Pound Canadian Dollar (GBP/CAD) Exchange Rate Slides with Brexit Uncertainty on the Rise
The Pound Sterling Canadian Dollar (GBP/CAD) exchange rate has slipped with the pairing currently trading at an inter-bank rate of CA$1.6208.
The Pound (GBP) fell on Thursday as Boris Johnson revealed his plans to reschedule the Queen’s annual speech for 14 October, proroguing parliament and narrowing the window for cross-party opposition to block a no-deal Brexit.
Johnson denied claims the move is designed to prevent parliamentary obstruction to his Brexit plans, but the suspension of parliament will limit the time those MPs opposed to a no-deal will have to pass a vote of no confidence in the Prime Minister.
Sterling remains dampened as uncertainty prevails, with the odds Johnson will eventually face a vote of no-confidence seemingly as high as the odds for a no-deal outcome.
Marshall Glitter, senior strategist at ACLS Global noted:
‘The only certainties are that a no-deal Brexit is even more likely, and that uncertainty has risen. Both are negative for the Pound.’
Canadian Dollar (CAD) Rises despite Falling Oil Prices
Meanwhile, on Thursday oil prices slumped following a speech from San Francisco Federal Reserve President Mary Daly.
During the speech, Daly commented on the strength of the US economy, noting that the US has ‘strong’ momentum, but is also affected by uncertainty and the impact of a global economic slowdown.
However, the drop in oil prices did little to stop the oil-sensitive Canadian Dollar (CAD) from rising against Sterling.
CAD Rises as In-Person US-China Trade Talks Likely for September
Reports that in-person US-China trade talks are likely to resume in September have offered a boost to the Canadian Dollar.
With a possible thawing of relations between the two super-powers, Chinese Commerce Ministry spokesman Gao Feng said China hopes the US cancel its planned additional tariffs:
‘The most important thing at the moment is to create necessary conditions for both sides to continue negotiations.’
Meanwhile, US Treasury Secretary Steven Mnuchin said:
‘We continue to have conversations. We’re planning for them to come.’
Pound Canadian Dollar Outlook: Will Canadian Average Wages Buoy CAD?
This afternoon’s release of the June Canadian average earnings could see CAD rise against the Pound if the data exceeds expectations.
The GBP/CAD exchange rate could then extend losses on Friday if Canada’s GDP report shows sturdy growth in the second quarter.