GBP/CAD – Rates are currently close to the best they have been in 6 months, however this could change later today. At 3pm the Bank of Canada will announce its latest interest rate decision, and there is a good chance they will raise rates to 1.25%. If so then the CAD could strengthen and pull GBP/CAD rates lower.
GBP/EUR – This pair remains very flat, having hardly moved following yesterday’s UK inflation numbers that came in roughly as expected. It has risen a little today back towards the €1.13 mark after the Euro weakened slightly. This was due to the fact the EU are unlikely to raise interest rates until 2019. There is a speech a Bank of England policy maker at lunchtime, but other that that there’s not much else being released this week from the UK until Friday when we see the latest Retail Sales. So, unless there’s any news on Brexit negotiations, I would expect this pair to remain flat.
GBP/USD – Pound/Dollar is still riding high at around the $1.38 mark. There are FED speeches today and Jobless claims from the USA tomorrow that could affect this pair, but I expect rates will remain around this level if the numbers are as expected.
Sterling exchange rates are likely to continue being driven by Brexit negotiations. If a transition deal is agreed and it looks likely that the UK and EU will seek a trade deal then the Pound will gain, however if progress is lacking then it’s likely any short term gains for the Pound will be limited.
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