The CAD to GBP exchange rate is currently bearish, trading near 60-day lows.
Key drivers include the interest rate differential, as the Bank of Canada maintains a stable policy rate while the Bank of England is expected to cut rates in mid-2026 due to slowing growth and inflation. This divergence may pressure the British pound further. Additionally, Canada's strong job growth supports the CAD, while U.K. fiscal concerns and trade issues create downward pressure on the GBP. Oil prices are also significant, as they recently reached 30-day highs, benefiting the CAD given Canada’s status as a major oil exporter.
The expected trading range suggests stability with limited fluctuations in the near term. Upside risks for the CAD could arise from unexpected increases in oil prices or further strong economic data from Canada. Conversely, downside risks might stem from worsening economic conditions in the U.K. or accelerated rate cuts by the Bank of England.