Currency - GBP / Canadian Dollar

The chart above is the epitome of a downward trending exchange rate. The downtrend that started after the spike in mid 2009 has barley taken a step back as the Pound has crumbled and the belligerently solid Canadian economy has driven the Canadian Dollar to the strongest levels we have seen in over a quarter of a century. Sadly for everyone planning to buy Canadian Dollars, the trend hasn’t changed direction yet. Demand for the Canadian Dollar and Canadian exports is as strong as it ever has been and even though the Pound has managed to rally from lows against other currencies, its gains against the Canadian Dollar have been rather lame in comparison. Sadly, what you need if you want to buy Canadian Dollars at better prices, is either for China to halt imports of commodities (unlikely but possible in part) because that would weaken Canada’s income from exports and weaken the Cad as a result. Or you need the US economy to show signs of falling into a double dip recession because that would diminish demand for Canada’s exports. Or you need the UK economy to leapfrog everyone else and storm into growth. That last one is a tad more unlikely until European demand picks up and Friday’s poor manufacturing data shows that we are a long way away from that happening. In the interim, we can expect more pain for those trying to migrate to or import from Canada and great news for anyone moving money in the other direction.