Pound Rises on Escalating US-Canada Trade Tensions
The Pound to Canadian Dollar exchange rate has seen significant gains due to escalating trade tensions between the US and Canada. Following the breakdown in US-Canada trade talks, Washington imposed 50% tariffs on $20bn worth of Canadian goods, prompting a retaliatory measure from Ottawa.
As a result, concerns about the potential impact on the Canadian economy weighed heavily on the Loonie (CAD), which faced heavy selling pressure. Meanwhile, oil prices dropped, further putting pressure on the 'Loonie'.
The Pound (GBP) was relatively muted during this period due to a lack of UK economic data, leaving Sterling without a clear direction against its peers.
Looking ahead, investors may be focused on US-Canada trade tensions and oil price dynamics. If oil prices rise amid the conflict in the Middle East, CAD could find some cushioning from the losses caused by the trade war. The only upcoming economic data release is Canada's preliminary wholesale sales for July, which is forecast to show a 1.3% slump in sales growth.