The Pound to Canadian Dollar exchange rate traded in a wide range last week, in response to a flurry of Brexit news.
Last Week: Pound Fluctuates on Brexit Headlines
The Pound got off to a flying start last week, roaring higher on the back of media reports that the UK and EU could be close to finalising a Brexit trade deal.
The upside GBP/CAD exchange rate through the start of the week was further underpinned by comments from Bank of England (BoE) chief economist Andy Haldane, as he poured cold water on speculation the BoE is gearing up to implement negative interest rates in the immediate future.
However Sterling then faced a setback in the latter half of the week after the EU announced it was formally launching legal action against the UK for violating the EU Withdrawal Agreement.
Meanwhile, the Canadian Dollar offered little resistance against the Pound last week as it was undermined by falling oil prices, which left the ‘Loonie’ unable to benefit from a stronger-than–expected GDP release.
Three Things to Watch out for This Week
- Brexit Developments
Brexit is likely to remain a key concern for GBP investors this week. While the UK and EU have ‘agreed the importance’ of finding a post-Brexit trade deal it remains to be seen if the two sides and bridge the remaining gaps in talks.
- UK GDP
Also set to influence the Pound this week will be the UK’s latest monthly GDP release as markets seek to gauge the trajectory of the UK’s economic recovery.
- Canadian Unemployment
In focus for CAD investors this week will be the latest Canadian unemployment figures. Will the Canadian Dollar be able to strike higher if unemployment fell back below 10% last month?
Looking ahead, trade in the GBP/CAD exchange rate may remain volatile this week, as Brexit, coronavirus concerns and fluctuating oil prices drive market sentiment.