BoC Shift Could Gift Sterling Some Breathing Space Against Canadian Dollar

The Loonie's strength could see the BoC becoming Fed-dependent and give sterling some breathing space after a crushing three-months. 

The Pound to Canadian Dollar pair has been in a downtrend since May after the Bank of Canada (BOC) decided to raise rates – supporting CAD - and Sterling weakened due to Brexit uncertainty.

The Canadian Dollar has been a star performer on global FX markets since May after the ship that is the Bank of Canada turned and plotted a course towards higher interest rates. The outlook is however highly dependent on how inflation behaves.

Technical strategists at one of Canada’s leading financial services institutions is wary that Sterling will fall back to 1.60.

The Canadian Dollar may have peaked, says Bank of America's FX strategist Kamal Sharma.

The Pound to Canadian Dollar looked bearishly poised at the start of the new trading week. 

Analysts are taking a sombre view of the Canadian Dollar as the dust settles following its recent rally.