Pound Canadian Dollar (GBP/CAD) Exchange Rate Zigzags
The Pound Canadian Dollar (GBP/CAD) exchange rate is fluctuating today as inflationary pressures add to mounting UK political challenges as oil prices plummeted overnight.
At time of writing, the GBP/CAD exchange rate is around CA$1.567, relatively unchanged from this morning’s opening levels.
Pound (GBP) Fluctuates as BoE Bailey Failed to Lift Investors
The Pound (GBP) is wavering today as Bank of England (BoE) Governor Andrew Bailey failed to inspire investors after his speech at the European Central Bank (ECB) Forum yesterday in Sintra, Portugal.
Joining both Federal Reserve and ECB speakers, Bailey addressed the forum as investors looked for further indications of how the BoE will bring down inflation. Despite stating that the BoE is ready to act more forcefully on interest rates, he appeared cautious and acknowledged that the economy showed signs of slowing,
The dovish tone Bailey struck was certainly in contrast to Fed Chair Jerome Powell and in turn, weighed on the Pound.
Elsewhere, Boris Johnson is returning to the UK after attending key international meetings as he prepares to deal with the political turmoil gripping the country. The divisive Northern Ireland protocol bill is edging closer to passing through parliament, potentially triggering a trade war with the EU.
Meanwhile, Scotland’s first minister Nicola Sturgeon also stokes the fires of divisiveness with her plans of a Scottish independence, while a ‘summer of discontent’ could see union strikes heavily disrupt UK economic activity, and in turn, the Pound.
Canadian Dollar (CAD) Softening amid Plummeting Oil Prices
The Canadian Dollar (CAD) is softening amid a sharp pullback in crude oil prices overnight as central banks continue to raise concerns over global growth forecasts, dampening demand.
With a drop of 4% overnight, the commodity-linked ‘Loonie’ is under pressure as continued rapid rate hikes from the central banks indicate a slowdown of economy amidst inflationary pressures. With the already tight oil market at present due to the ongoing Ukraine conflict, supply issues continue to weigh on the economy, and in turn, the Canadian Dollar.
Elsewhere, CAD investors will be looking forward to monthly GDP growth due to be released today. Despite an expected expansion of 0.2% in May, this will be the fourth consecutive month where Canada’s economy has slowed.
Pound Dollar Exchange Rate Forecast: Pound to be Left Vulnerable to Domestic Woes?
Looking ahead, the Pound could be left open to market sentiment as a lack of major data leaves Sterling vulnerable to domestic issues as Brexit fears continue, and further signs of a struggling economy could exert further headwinds.
Elsewhere, Statistics Canada will release GDP data for the month of April and preliminary GDP growth for May. An expected slowdown in growth could weigh on the commodity-linked ‘Loonie’.