2020 was a difficult year for not just the manufacturing sector but for the whole UK economy, with the global coronavirus pandemic disrupting almost every industry in some way and resulting in uneven demand for manufacturers throughout the year.
- Canadian dollar set to weaken if BoC sounds dovish note
- New round of Brexit discussions may benefit pound
- Euro trends lower ahead of latest ECB commentary
Bullish oil prices shore up Canadian dollar
A bullish oil market helped to shore up the Canadian dollar yesterday as oil prices rose to a fresh 2019 high, driven by the prospect of decreased Iranian supply.
However, CAD exchange rates look set to come under pressure this afternoon as anticipation builds for the Bank of Canada’s (BoC) April meeting.
Markets are wary of the prospect of BoC policymakers adopting a more dovish bias, raising the risk of interest rates seeing a cut in the months ahead.
If the central bank maintains a positive outlook, though, this could see the Canadian dollar trending higher across the board today.
Pound strengthens ahead of latest Brexit discussions
With the Labour leadership preparing for fresh talks with Theresa May over a potential Brexit compromise the mood towards the pound improved.
This optimism could prove short-lived, however, if the two sides fail to make any tangible progress towards a mutually agreeable deal.
The appeal of the pound could also improve, though, on the back of March’s public sector net borrowing figure.
With forecasts pointing towards a lower level of new government debt this may give investors renewed cause for confidence in the economic outlook.
Euro vulnerable ahead of ECB Bulletin
The latest European Central Bank (ECB) Economic Bulletin could see the euro losing fresh ground against its rivals this morning.
Evidence that the central bank is still taking a cautious view on the economic outlook would leave the single currency exposed to fresh selling pressure.
As long as the odds of the ECB raising interest rates before the end of the year remain minimal the strength of the euro is unlikely to pick up.
On the other hand, signs of increased optimism among policymakers could offer EUR exchange rates a boost in the short term.
Wednesday, 24th April 2019
09:00 EUR European Central Bank Economic Bulletin
09:30 GBP Public Sector Net Borrowing
15:00 CAD Bank of Canada Rate Decision
Joining the corporate trading desk in 2007, Phil now over sees all of Currencies Direct’s corporate dealing activity. Having gained experience working with hundreds of businesses to optimise international payments processes and execute comprehensive risk management strategies, Phil currently works with a portfolio of corporate clients whilst managing Currencies Direct’s overall market exposure
Phil has FCA approval and has completed the Certificate in International Treasury Management (CertiTM)