Analysis of recent loonie→Sterling forecasts for 2024. We collate forecasts from respected FX analysts together with the latest Canadian dollar to Pound Sterling performance and trends.
Forecasts for CAD to GBP
Recent forecasts from CIBC Capital Markets and Scotiabank indicate some headwinds for the Canadian Dollar (CAD) in the near term against the US Dollar, which could also have implications for the CAD to GBP exchange rate. CIBC Capital Markets expects the CAD to weaken, with their year-end forecast for the USD/CAD rate in 2024 being raised to 1.31, up from 1.28. They also highlight optimism for the CAD in 2025, suggesting the potential for a weaker USD across the board. Scotiabank analysts have noted that the CAD has fallen short of Q3 2023 expectations against the USD and appears undervalued based on fundamental economic indicators. A possible increase in interest rates by the Bank of Canada, which the market may not have fully accounted for, could lead to a strengthening of the CAD nearer to the 1.30 mark by the late 2023. The Canadian economy shows signs of resilience, as indicated by robust employment figures, which may support economic activity; however, weaker labor markets toward the end of the year could signal further rate cuts and a potential weakening of the CAD.
On the other side of the pair, currency strategists from various institutions including Wells Fargo and TD Securities are sensing a tilt toward bearishness for the British Pound (GBP), with forecasts of a drop to 1.20 or below against the USD by early 2024. UK consumer confidence has waned, often a precursor to economic downturn, further justifying this cautious stance on the GBP. Given that GBP/USD is known for high volatility and is sensitive to economic data, political events, and changes in central bank policies, these factors could contribute to rapid exchange rate fluctuations. Furthermore, If the Bank of England ends policy tightening sooner than the market expects, Sterling could lose further ground.
Current market data shows the CAD to GBP exchange rate at 0.5852, which is marginally below its three-month average of 0.5925, and it has been relatively stable, trading within a 5.3% range. In the context of Canada as a significant oil exporter, the CAD could be influenced by oil price movements. Brent Crude OIL/USD prices have been 5.3% below the three-month average and exhibited considerable volatility, which is notable given the correlation between the CAD and oil prices. FX analysts will be closely watching these commodities and geopolitical developments, as they serve as potential indicators for future movements of the CAD, indirectly impacting the CAD to GBP exchange rate.
@bestfxrates : 📉 Amid forecasts of a weaker CAD due to potential headwinds & raised USD/CAD year-end targets by CIBC to 1.31, coupled with a bearish outlook for GBP, the CADGBP trades at 0.5852, under 3-mo avg. Oil volatility & BoC/BoE moves could sway this pair. Market eyes on key indicators. #ForexUpdate #CADGBP
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Compare & Save - Canadian dollar to Pound Sterling
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CAD/GBP historic rates & change to 30-Nov-2023
Will the Canadian dollar rise against the Pound Sterling?
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Forecasts disclaimer: Please be advised that the forecasts and analysis of market data presented on BestExchangeRates.com are solely a review and compilation of forecasts from various market experts and economists. These forecasts are not meant to reflect the opinions or views of BestExchangeRates.com or its affiliates, nor should they be construed as a recommendation or advice to engage in any financial transactions. Read more