geedee

For what it's worth from the Custom House newsletter....

"That being said, as we have mentioned many times in the last few weeks, the fundamentals are supportive for the Canadian dollar versus the crosses, especially the Euro and Pound. We are seeing levels not seen since the start of 2008 against the Euro, and are trading at 15 year lows for GBPCAD! We see no reason for this to stop in the medium term but the loonie might be poised for a moderate pullback against these currencies on shorter horizons."

What I don't understand is why the USD is looking so strong when their economy is quite clearly in tatters....

Iain Mc

On the financial news this morning they'd said something along the lines of...

"Investment money has been flooding out of the US into Europe recently whilst Europe was seen as a safer haven, but now things are going to crap in Europe (bank bailouts, etc) some of that over-correction is heading back the other way, hence the rise in the dollar"

I paraphrase

ireland2canada

Yes, but what does that meeeeean? I want dates and times and exact rates.

I jest of course.

scottymallo

IRELAND2CANADA,

why do you not use a trading account to transfer rather thank cash? I ve just secured 1.90 with HSBC international services Canadian forex are offering 1.88 at the moment?

G77

Up to 1.94 today - guess there must be some speculation that UK interest rates will be held on Thurs (and the falling price of oil can't hurt)?

scottymallo

That good news lets hope it will give a few more days of these rises!! Everytime we get positive news it turns again!!

benjy25

Anybody know what the key drivers between GBP and CAD are?

I thought interest rates in the UK were likely to be cut in the near future?

Paul Wildy

Generally 3 things affect the rate:

1 - price of oil. If oil goes down (like it has done in the last few days) thats bad for Canada but good for UK, therefore GBP gets stronger against CAD

2 - the financial markets opinion of the reletive strength of the UK and Canadian economies. At the moment there is bad news in both but generally if there is more bad news regarding UK economy than Canada, then GBP weakens against CAD. More bad news in Canada means GBP is relatively stronger

3 - Interest rates as you already pointed out.

The recent slight improvement is probably to do with 1 - Oil prices have fallen.

benjy25

Thanks, that's very clear.

Ben

emmae

Here is what MoneyCorp say about a potential interest rate cut. To me, a layperson, it seems the effect of an interest rate cut may have the reverse effect. Here's hoping.

"Given the disconnect between the Bank of England's official rate and the actual cost of borrowing in the wholesale market, some analysts believe there would be no point in lowering rates by the usual quarter percentage point. They argue that only a cut of 50 basis points - or even more - would have any effect on the real cost of money or on public psychology. Would such a move hurt the Pound? In normal times yes, but in the current circumstances it could be seen as a decisive and progressive step for the economy, in which case it would be positive for Sterling."

ireland2canada

Yea, this week so far has been positive, please may it continue! I am now back to dithering, maybe today, maybe tomorrow. Argh.
Sorry I missed your previous post - I don't have an account in Canada yet to transfer funds into. So cash it is, plus I'll be needing it as soon as I arrive.

Fingers crossed eh?

scottymallo

info regarding the 0.5% interest rate cuts given by fat prophets.

Members will be aware (through our weekly market comments) that we saw a co-ordinated interest rate cut as an inevitable response to the current crisis facing the world economy. Earlier today this materialised.

In an effort to stimulate ailing growth across the globe, the US Federal Reserve, the European Central Bank, the Bank of England, and the central banks of Canada, Switzerland and Sweden and the United Arab Emirates all cut their main lending rates by half a percent. In addition, China's central bank lowered its key one-year lending rate by just over half a percentage point.

In our view, this is the latest in a number of extreme measures that will galvanise the banking sector and quell the volatility which, as the Volatility Index (VIX) illustrates, has never been so high.

Earlier today, it was also announced the UK government is to plough up to £250 billion into the banking system in an effort to keep banks lending. In effect, it is underwriting the UK banking sector. This is an unprecedented move and could well serve as much needed rocket fuel for the markets.

Meanwhile, over in the US the Federal Reserve is now buying up commercial paper. The commercial paper market provides companies with their short term funding and is a vital source of operating capital. The Fed’s actions are bridging the currently derelict no man’s land between the bank and companies which in turn will lubricate the cogs in the lending machine.

lauder99

Hey Ireland2Canada

Just to let you know that you don't immediately need an account in Canada to take advantage of forex companies. When we transferred our biggest lump the transfer went through and they held our dollars in their account until we gave them account details to transfer it too.

We used Halo.

Hope that helps

Tom

ireland2canada

Hey

Thanks for that, I'll take a look into Halo! It would really be nice to benefit from the higher rates offered by the forex folk - however I'm talking about less than $3000 here so I'm in two minds whether to bother or not. Also, if they held my money till I got an account I would be living on fresh air. Literally.

But thank you for the recommendation, I'll check out their site.

ireland2canada

While I'm here...Can anyone explain whether the 0.5% reduction announced today is a good or bad thing for those wanting to exchange £ to $cad?