The Pound to Canadian Dollar (GBP/CAD) exchange rate climbed to a multi-week high last week as falling oil prices weighed heavily on the commodity-linked ‘Loonie’.
At the time of writing, GBP/CAD was trading around CA$1.8645, up roughly 1% on the week.
Pound to Canadian Dollar (GBP/CAD): 1.86455
Euro to Canadian Dollar (EUR/CAD): 1.61194
Dollar to Canadian Dollar (USD/CAD): 1.36763
DAILY RECAP:
The Canadian Dollar (CAD) came under sustained pressure last week as oil prices retreated sharply.
Brent crude dropped back below $100 a barrel amid renewed optimism surrounding a possible US-Iran peace agreement after comments from US President Donald Trump suggested progress was being made towards a final deal.
While renewed clashes in the Strait of Hormuz briefly interrupted the decline in oil prices, the rebound proved limited and failed to provide lasting support for the ‘Loonie’.
Additional downside pressure came from Canada’s latest labour market report, which unexpectedly showed employment contracting in April and reinforced concerns over slowing economic momentum.
Meanwhile, the Pound (GBP) traded cautiously at the start of last week amid the extended UK Bank Holiday weekend and a lack of domestic economic data.
Sterling later found support from improving market sentiment as hopes for de-escalation in the Middle East boosted demand for risk-sensitive currencies.
However, gains were limited as attention shifted to the UK local elections, where Labour suffered substantial losses while Reform UK made significant gains.
Current councillor changes show Labour down 202 seats, the Conservatives down 61, while Reform UK added 270 councillors. The Liberal Democrats gained 29 seats and the Greens added 23.
Political uncertainty initially pushed UK bond yields sharply higher and weighed on Sterling sentiment, although the Pound later stabilised after Prime Minister Keir Starmer pledged to remain in office despite the election setbacks.
GBP/CAD Forecast: UK GDP and Oil Prices in Focus
Looking ahead, the UK’s latest GDP figures are likely to be a key driver for Sterling.
If the data confirms stronger economic growth in the first quarter of 2026, the Pound may strengthen further.
For the Canadian Dollar, oil price dynamics are expected to remain the dominant influence.
Continued progress towards a diplomatic agreement in the Middle East could place further pressure on crude prices and weigh on CAD, while renewed geopolitical tensions may help support the commodity-linked currency.
