Yesterday the UK voted to leave the EU in a decision that will impact not just Britain and the European Union, but the whole world. Currency and stock markets reacted immediately with a near 10% fall in both the pound and the FTSE 100.
What does the Brexit mean for the Canadian dollar?
CAD vs GBP
As of the time of writing the Canadian dollar has risen 5.5% against the pound.
USD vs GBP
The US dollar has risen almost 10% against the British pound.
CAD vs USD
The US dollar has been boosted by investors looking for an alternative to the GBP. At the time of writing the CAD was down 2.5% against the USD, however the CAD could make a comeback as the situation stabilizes.
Commodity prices are down as investors expect lower global growth…
…Except for Gold
Investors concerned about global market stability are pulling their money out of stocks and putting it into safer currencies (like the USD) and into gold.
When should I buy Currency?
Should I Buy British pounds?
It is impossible to know exactly how the foreign exchange market will move. Some experts predict that the pound will stabilize, in which case it would be better to buy now. Others, however, believe that the Bank of England could cut interest rates, pushing the pound down further in the coming weeks.
CAD to USD
The Canadian dollar is down against the US dollar, but how long this will last is anyone guess. Once the markets stabilize the CAD could make a comeback, but if the UK cuts interest rates it could lead to another USD surge. Of course, with growing global uncertainty, the Fed could cut interest rates which would cause the US dollar to fall in value.
USD to GBP
If you have USD you can take advantage of the near 10% drop in the GBP against the USD by making a foreign to foreign exchange at Continental Currency.
How will the Brexit impact my travel plans?
It will take at least two years for the UK to leave the EU, with many people predicting that it could take until 2020. Even then it remains uncertain what restrictions, if any, will be placed on visitors travelling to the UK or between the UK and EU.
Learn more about the Brexit (prior to the historic vote) with our comprehensive guide.
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