The big news in the central banking world is the Bank of England announcement that current Bank of Canada chief Mark Carney would take over in the spring.
This is considered a great pick, as Mark Carney is incredibly well respected, and has successfully guided Canada through a challenging period without a big banking bust.
So what does this mean for currency markets?
SocGen’s Sebastien Galy sent out a one-liner explaining the impact on currencies:
It had to happen eventually. Not good for CAD, given now a loss of credibility, but that is temporary. One may take it as a reason to buy GBP, with someone who understands markets and financial stability.
Here’s a chart of the British Pound vs. The Canadian Dollar. Note the insta-surge right when the announcement was made at 3:30 PM U.K. time.
Photo: Yahoo Finance
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