GBP/CAD Inches Up After UK Parliament Votes Brexit Bill

GBP/CAD is advancing on Friday, ending the week with a modest increase. The pair is currently trading at 1.7077, up 0.18% as of 9:40 AM UTC.

Yesterday, the UK Parliament’s House of Commons voted the final reading of the Withdrawal Agreement Bill (WAB), which allows Prime Minister Boris Johnson to “get Brexit done.” The House of Lord will have the final word in the next few weeks. The UK is set to leave the European bloc by January 31. Next, the two sides have to reach a trade deal within the next 11 months, as Johnson made it illegal to extend the Brexit transition period beyond December 2020.

While the pound has benefited from the Brexit optimism after the vote in parliament, the Loonie is under pressure after the Canadian Mortgage and Housing Corporation (CMHC) said that housing starts had declined last month by 3% to 197,329 units from a revised 204,320 units in November. The result surprised economists, who anticipated an increase to 210,000.

Nevertheless, the Canadian dollar is still in a better position than the sterling when judging by larger timeframes. The Loonie might leverage the confidence of Bank of Canada (BoC) Governor Stephen Poloz, who said yesterday that potential risks from global trade tensions have eased. He said:

“Certainly, it seems that the potential downside risks have eased as the United States and China approach a deal. This all bears watching during the coming year.”

However, Poloz admitted that there was still a lot of uncertainty about what the US-China agreement could mean for Canadian exports.

Earlier this month, US President Donald Trump stated that he would ink the deal with Chinese representatives on January 15, though he said yesterday that the deal could be signed “shortly thereafter.”

The Bank of Canada’s next meeting to decide the interest rate is scheduled for January 22. Last year, the central bank resisted the pressure to cut rates, while its US and European counterparts did so on several occasions.

Later today, the GBP/CAD might become volatile as Canada is set to release employment change data and the unemployment rate for December.

Currencylive.com is a news site only and not a currency trading platform.

Currencylive.com is a site operated by TransferWise Inc. (“We”, “Us”), a Delaware Corporation. We do not guarantee that the website will operate in an uninterrupted or error-free manner or is free of viruses or other harmful components. The content on our site is provided for general information only and is not intended as an exhaustive treatment of its subject. We expressly disclaim any contractual or fiduciary relationship with you on the basis of the content of our site, any you may not rely thereon for any purpose. You should consult with qualified professionals or specialists before taking, or refraining from, any action on the basis of the content on our site. Although we make reasonable efforts to update the information on our site, we make no representations, warranties or guarantees, whether express or implied, that the content on our site is accurate, complete or up to date, and DISCLAIM ANY IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. Some of the content posted on this site has been commissioned by Us, but is the work of independent contractors. These contractors are not employees, workers, agents or partners of TransferWise and they do not hold themselves out as one. The information and content posted by these independent contractors have not been verified or approved by Us. The views expressed by these independent contractors on currencylive.com do not represent our views.