Pound Sterling Canadian Dollar (GBP/CAD) Exchange Rate Muted as Oil Prices Steady
The Pound Sterling Canadian Dollar (GBP/CAD) exchange rate remained flat this morning. This left the pairing trading at around CA$ 1.7293.
The Canadian Dollar remained flat against the Pound as oil prices steadied on Wednesday.
Prices were supported by increased hopes that a meeting between OPEC and its allies would result in output cuts. This would support prices after overproduction and the coronavirus pandemic caused prices to collapse.
Thursday’s meeting is expected to be more successful than the group’s March meeting which sparked a price war between Russia and Saudi Arabia.
Commenting on this, Bjornar Tonhaugen of Rystad Energy noted:
‘The coming extraordinary producing-countries meeting is the only hope on the horizon for the market.
‘Nobody wants to go short ahead of what could be a ‘positive surprise’ by OPEC+.’
However, sources from OPEC have said that a deal to slash production is conditional on the participation of the United States.
Sterling (GBP) Flat as PM Spends Second Night in Intensive Care
The Pound edged lower against a handful of currencies on Wednesday as traders flocked back to the safety of the US Dollar (USD).
Demand for safe-haven currencies rose as concerns the coronavirus pandemic was far from over dominated financial markets.
Earlier this week, Sterling suffered knee-jerk reactions to the Prime Minister Boris Johnson being admitted to hospital over coronavirus symptoms.
The Prime Minister spent his second night in intensive care, although reports have suggested he is in a stable condition.
This morning, health minister, Edward Argar said the Prime Minister is ‘comfortable, he’s stable, he’s in good spirits’.
Commenting on this, Viraj Patel, global FX and macro strategist at Arkera said:
‘The Pound’s been pulled around by external factors at the moment – largely the broader risk and Dollar environment – with key themes in equities and oil markets driving FX sentiment.
‘We’ve seen a couple of knee-jerk moves lower on the headlines over PM Johnson being in hospital. But these have faded quickly, with the short squeeze and positioning adjustment in high-beta currencies dominating FX markets.’
Pound Canadian Dollar Outlook: OPEC Meeting in Focus
Looking ahead to this afternoon, the Canadian Dollar (CAD) could suffer losses against the Pound (GBP) following the release of building and housing data.
If both Canadian housing starts and building permits slump further than expected, the ‘Loonie’ will suffer losses.
Meanwhile, Thursday’s meeting between OPEC and its allies will remain in focus for the pairing.
If the meeting results in a deal to cut production and tensions between Saudi Arabia and Russia ease, the Pound Canadian Dollar (GBP/CAD) exchange rate could reverse any gains from Wednesday and slump.
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TAGS: Pound Canadian Dollar Forecasts