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Pound Nears 2-Week High Versus Canadian Dollar, as Oil Price Tumbles

Market CommentaryPound Nears 2-Week High Versus Canadian Dollar, as Oil Price Tumbles
Pound Nears 2-Week High Versus Canadian Dollar, as Oil Price Tumbles
Image credit: Sarah Buxton.

Welcome to Pure FX's latest update of the pound to Canadian dollar exchange rate. This tells you when it may be the best time to exchange pounds to Canadian dollars, for your money transfer!

Sterling flies higher versus the loonie! The pound to Canadian dollar exchange rate has hit 1.7061 today, its highest since December 7th, or close to 2 weeks.

By contrast, back on December 12th, sterling was at just 1.6714 versus the CA dollar, so it's since risen by +2.07%, or +3.5 cents.

To put this into context, a £250,000 transfer to Canada at this exchange rate would be worth CA$426,525, or +CA$8,675 more than on December 12th.

So if you're a Brit thinking of moving to Alberta or Montreal, or you're a UK firm importing CA goods, it may be a top time to buy CAD!

Canadian Dollar Weakens, as Oil Price Slumps

The pound has neared this 2-week high versus the Canadian dollar, because the price of oil, Canada's biggest export, has fallen sharply.

Yesterday, the price of crude fell by -7.3%, to just $46.24 a barrel.

This is because it's forecast that America's shale oil producers will continue to boost supply, even as global demand for oil declines, thus weighing on oil's price.

This has weakened the Canadian dollar, because when the oil price falls, Canada's oil refiners make less money from selling their black gold overseas. This slows Canada's economic growth, and the loonie dollar also!

CA Dollar Loses Out, as Canada's Manufacturing Shipments Fall

What's more, the pound to Canadian dollar exchange rate has also risen, because Canada's manufacturing shipments unexpectedly fell in October, said official data yesterday.

Factory shipments in Canada declined by -0.1% in October, according to Statistics Canada on Tuesday, well below forecasts for a +0.4% rise.

This is because there were lower shipments of wood product and primary metals manufacturing.

"Expectations were running high for factory sales, but the data proved disappointing," said CIBC economist Royce Mende of this data, thus dragging down the Canadian dollar!

Pound Rises, as Economists Think Article 50 Will Be Extended

Moreover, sterling has also neared this 2-week high versus the loonie dollar, because a growing number of economists think that the UK will extend Article 50, to stay in the EU for longer.

In recent weeks, UK prime minister Theresa May has struggled to convince Parliament to support her draft Brexit deal.

Given this, Mrs. May could extend Article 50, to gain time to win MPs support.

If so, this would lift sterling, because it raises the odds that the UK will eventually exit the EU in an orderly fashion, with a favourable deal, so giving certainty to businesses and investors!

Get A Free Pound to Canadian Dollar Exchange Rate Quote

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You’ll get a highly competitive pound to Canadian dollar exchange rate for your money transfer!

Please bear in mind, this article is Pure FX’s opinion only and does not constitute advice. Moreover, the exchange rates referred to in this article are the interbank rates, which are the rates at which banks and financial institutions buy and sell currency to each other. Therefore these exchange rates cannot be accessed by individuals or SMEs, and are not the same rates that Pure FX can offer. To get a free exchange rate quote, call us on +44 (0) 1494 671800, or email [email protected]

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