GBP/CAD exchange rates focused on potential interest rate hike and Turkey this week

We have had an interesting week for GBP/CAD exchange rates, with the Canadian Dollar winning the battle and currently sitting roughly 1% up on the week so far.

Turkey and the issues that have been well covered in the media have led to a fairly volatile period for all major currencies, but the main movement we saw in favour of the Canadian Dollar appears to be down to interest rate hike expectations.

We had reasonably positive jobs data out from Canada earlier in the week and this has led to a flurry of expectation that we may see the Bank of Canada raise their interest rates again at the next BOC interest rate meeting in September.

Strong jobs data, a positive tone in the last speech from BOC Governor Stephen Poloz and a recent survey suggesting that 53% of Canadians are not seeing any impact on rising borrowing costs have all led to the chances of a rate hike increasing.

The BOC had planned to monitor the impact of higher interest rates for typical households and if this view remains in the coming weeks then they may take another step forward and raise interest rates again.

For those that are not aware, an interest rate hike is generally seen as positive for a currency and even the mere speculation of it happening can lead to strength for that particular currency.

The Canadian Dollar could make more ground up on Sterling as long as there is no positive Brexit news, no negative NAFTA news and as long as growth figures (due out before the next interest rate decision) do not disappoint.

If you have a currency exchange to carry out in the coming weeks then it is well worth registering your interest with me on [email protected] so that I can fully keep you up to date with the latest action. We can help by informing you of a spike in the market in your favour and help with upcoming market data to enable you to time your transfer and maximise on your return. 

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