GBP/CAD continues the downtrend on Tuesday, but the pair tries to rebound. Currently, one British pound buys 1.6927 Canadian dollars, down 0.07% as of 10:12 AM UTC.
The quotation started to decline sharply last Friday when it left the 1.7070 territory. CAD has been pushed by increasing oil prices amid optimism surrounding the Sino-US trade relationship.
In the morning, GBP/CAD tumbled to 1.6895, but the price has rebounded after the UK released services activity data.
UK Services Sector Stagnates Amid Brexit Uncertainty
The UK’s services industry stagnated in October amid Brexit concerns. New orders dropped at the fastest pace in six months, according to data provided by IHS Markit.
The services purchasing managers’ index (PMI) rose to 50.0. This suggests a flat dynamic, from 49.5 in September — one of the lowest figures in ten years. Nevertheless, the reading beat analysts’ expectations of a slight increase to 49.7, which prevented the GBP from further decline.
Manufacturing and construction PMIs remained below 50 points last month. It kept the composite PMI in the contraction territory for the third straight month. The last time when this happened was in 2009.
IHS Markit economist Chris Williamson commented:
“The underlying business trend remains one of stagnation at best.”
“The October reading is historically consistent with GDP declining at a quarterly rate of 0.1%, similar to the pace of contraction in GDP signalled by the surveys in the third quarter,” he added.
The information provider said that the surveyed services businesses were worried about Brexit uncertainty and reduced orders, which declined last month by their most in six months.
UK New Car Sales Tumble 7%
Separately, the Society of Motor Manufacturers and Traders (SMMT) reported that new car registrations in the UK declined by 6.7% year-on-year in October, with orders from individual buyers tumbling 13%. Thus, 143,251 cars were sold last month, down from 153,599 in the same period in 2018.
SMMT CEO Mike Hawes noted an increase in alternatively fuelled vehicles:
“The growth in alternatively fuelled cars is very welcome, showing increasing buyer appetite for these new technologies.”
Later today, Canada will publish imports and exports data.