The GBPCAD pair was waiting for Canadian employment figures on Friday. The latest trade balance figures for the Canadian economy were also released.
GBPCAD – Weekly Chart
The pound sterling found support against the CAD around the 1.4000 level and soared higher to 1.5500. The move in GBPCAD was based on the U-turn by the UK government on its tax cut plans.
This week has seen the Canadian dollar recover after oil found an OPEC rally. The week ahead sees essential data releases. Friday was expected to show a 20k addition of jobs in Canada, with the unemployment rate expected to stay steady at 5.4%.
Next week will be the turn of the UK economy, with the jobs data set to be released on Tuesday. Traders will look for an improvement on June’s additional 40k jobs and an unemployment rate of 3.6%.
However, wage growth data has been a problem for the UK economy despite additional jobs and high vacancy levels. Further data for the UK will come from GDP for August. That is expected to show a 2.3% year-on-year improvement, but other issues are coming on a shorter time horizon.
The Pound sterling could also be hit by further gloomy updates from the IMF. The IMF managing director, Kristalia Georgieva, warned of central bank pivots.
“Not tightening enough would cause inflation to become de-anchored and entrenched, which would require future interest rates to be much higher and more sustained, causing massive harm on growth and massive harm on people.”
