Since the end of last year the GBP/CAD has been trading in a broad range, with a resistance at 2.06 and a support level at 1.93. Although at one stage there were predictions that the topside resistance would be breached and the market hit 2.09, it now seems that the support level is in more danger of being broken.

At the end of August the market touched its 10-month low at 1.90 and although it seems to have stabilised throughout September’s trading, it appears unlikely that GBP will make much of a recovery, especially with recent comments from the BOC seemingly ruling out the possibility of an interest rate cut in the near future. Although falling commodity prices would traditionally weaken the Loonie, with the UK economy in turmoil and the Canadian economy benefiting from stable inflation around 2%, leaving them open to cut rates as they see fit, the CAD is likely to remain relatively the stronger of the cross.

Analysts have revised their predictions and it is now expected that the market will remain range-bound between 1.88 and 1.93.