Pound Sterling (GBP) Outlook Up on CAD & NOK Today

April 21, 2016 - Written by Minesh Chaudhari

STORY LINK Pound Sterling (GBP) Outlook Up on CAD & NOK Today

GBP has jumped against the NOK and the CAD today, despite earlier domestic data being extremely poor.

Canadian Dollar (CAD) Strengthened on Oil Price Rebound

Oil bounced and the Canadian Dollar (currency : CAD) surged during late trading yesterday following the publication of the latest weekly US Crude Oil Inventories data.

Last week’s official figures had seen stocks of ‘Black Gold’ increase by a heady 6.634m barrels in the world’s premier economy; a distinctly lower level of oversupply was anticipated this week, with Oil insiders predicting a result of 2.40m.

The print of 2.080m barrels therefore provided investors with further evidence that the global oversupply of oil which triggered the move down to $27 for a barrel of Brent Crude earlier this year is beginning to dissipate rapidly.

The news sent the price of Crude back up through the $44 per barrel level and triggered a downside shift for the GBP CAD exchange rate.

The pair had settled above the 1.8300 threshold yesterday, but was back down in the low 1.8100s a short time ago thanks to the US Oil Inventories data.

The Sterling Norwegian Krone exchange rate showed similar price action this afternoon for similar reasons, dropping from an intraday high of 11.7220 down to 11.6549.

FX insiders that if oil prices continue to improve, there will be further losses for the GBP CAD and GBP NOK exchange rates in the short-to-medium term.

ECB Interest Rate Decision to Provoke Euro Volatility Today

Looking ahead, the premier risk event for today’s session comes in the form of this afternoon’s European Central Bank (ECB) monetary policy announcement.

‘No change’ is expected from the ECB, however this does not necessarily equate to no movement for the euro (currency : EUR). Look for comments from ECB President Mario Draghi in his post-decision press conference suggesting that the euroland’s interest rates may remain lower for longer to cause a renewed shift out of euro-denominated assets.

If such an outcome materialises, then expect the Pound euro exchange rate to track higher towards the psychologically significant 1.3000 threshold.

International Money Transfer? Ask our resident FX expert a money transfer question or try John's new, free, no-obligation personal service! ,where he helps every step of the way, ensuring you get the best exchange rates on your currency requirements.

TAGS: Canadian Dollar Forecasts Norwegian Krone Forecasts Pound Sterling Forecasts