Sterling exchange rate fluctuates as WTI meets resistance
The British pound (GBP) sees little movement against the Canadian dollar (CAD) this morning as both currencies are constrained by a lack of meaningful data. Rather, the direction is determined by the dynamics of oil and the latest developments in coronaviruses.
As of this writing, GBP / CAD is trading at CA $ 1.7310, virtually unchanged from today’s opening levels.
Canadian dollar (CAD) exchange rate under pressure from faltering oil prices
The Canadian dollar suffered some minor losses against the pound this morning as oil prices come under pressure. WTI prices edged down after the bullish momentum of the previous two sessions.
On the daily chart, WTI has come under intense pressure from the July 6 high of $ 76.40. After dropping to $ 61.80 on Sunday, prices returned to highs of $ 67.50 in the first half of this week.
A risky attitude in the market supported the recovery of WTI, alongside expectations of an acceleration of the vaccination campaign in America. The United States Food and Drug Administration has now granted full approval to the COVID-19 vaccine developed by Pfizer and BioNTech.
Subsequently, WTI lost support as investors reduced their open interest positions and contract volume fell to 156.4K yesterday. Erratic data from the CME group inspired bearish trading.
In addition to oil pressures, the Canadian dollar faces headwinds on the latest Covid-19 data. Doctors fear that the fourth wave of Covid in Canada may be the largest yet, as the number of cases increases in Ontario, Alberta and British Columbia.
Dr. Allison McGeer, an infectious disease specialist with the Sinai health system in Toronto, issued a grim warning Monday: “If we don’t do anything about the growing number of cases, we are going to push our health system to the limit. again the limit. And a lot of people are going to die.
British pound (GBP) exchange rates hold on to gains despite significant headwinds
The pound resists bearish pressure against the majority of its peers this morning despite a series of worrying data. The UK’s supply chain crisis worsens as new statistics show the weakening effectiveness of vaccinations over time.
Yesterday’s CBI data revealed that stock levels at major retailers are at their lowest since at least the 1980s, due to the disruption of the global supply chain triggered by the pandemic and labor shortages. work, made worse by the Brexit disruption as the UK emerges from lockdown.
Meanwhile, statistics reveal that Covid-19 kills an average of 100 people a day in the UK. Health experts are calling for an “urgent” need for booster shots as the Zoe COVID study reveals that Covid protection against two doses of Pfizer or AstraZeneca vaccines begins to wane within six months.
In a reasonable “worst case scenario”, protection could drop below 50% for seniors and healthcare workers by winter, according to the Zoe COVID study analysis.
Despite these updates, the pound holds up as the weak US dollar provides support. USD investors are worried ahead of the Jackson Hole Symposium, which begins tomorrow.
GBP / CAD exchange rate forecast: Oil and Covid news will boost movement
A lack of meaningful data the rest of the week leaves the pound and the Canadian dollar exposed to losses against their peers.
The movement of the CAD is likely to be led by oil prices, which in turn are affected by perceived demand. Political tensions, along with renewed Covid restrictions, could threaten demand for crude oil.
Meanwhile, domestic and international coronavirus cases are sure to have an impact on the GBP / CAD, with increasing cases in both countries putting downward pressure. If cases increase globally, a risky mood will likely ensue, supporting safe-haven currencies at the expense of the risky pound.