The pound sterling continues to advance against the Canadian dollar with the exchange rate now at levels last seen back in 2009.

The pound sterling to Canadian dollar exchange rate (GBP/CAD) continues to head higher; at 14:44 in London we see the rate 0.42 pct higher at 1.7879.

(Note: Our GBP/CAD quotes are from the spot markets. Your bank will charge a spread on the rate at their discretion. However, an independent FX provider will guarantee to undercut your bank's offer, thus delivering you up to 5% more currency. Please learn more here.)

The British pound is currently the main driver in this pairing following on from a non-event Bank of England MPC decision delivered at 12PM today.

Some analysts had been expecting the MPC to announce changes to the forward guidance policy - however this was not to be the case and GBP was bid higher against the Canadian dollar as a result.

Indeed, the GBP's strength is widespread and as Citigroup acknowledge the currency is likely to be one of the outperformers in 2014.

The return to form for the GBP comes just as the fortunes of the Canadian dollar (CAD) wane.

A technical forecast issued by TD Securities predicts the GBP/CAD pair could head towards the 1.80 area in the short-term.

Short-term outlook for Cad vs pound sterling

Shaun Osborne at TD Securities says:

"GBPCAD perked up a little yesterday and the GBP has nudged higher again this morning—reaching new cycle highs.

"We thought the correction/consolidation was unlikely to extend significantly, given the strong, underlying trend momentum evident in this market—note that the daily DMI study has switched back to bullish quickly today after slipping into neutral in the past few sessions—and the push through minor trend resistance (the top of a rising wedge pattern) negates near-term downside risks and puts the GBP on track to test the 1.80 area. We are bullish here."

CAD under broad-based pressure

The CAD has fallen to a fresh three plus year low, it is down 0.2% from yesterday’s close against the USD and is the worst performing primary

currency leading into the North American open.

"CAD is trading at multi‐year lows against the USD, GBP and EUR. Today’s data includes housing starts, home prices and building permits, however these releases are unlikely to have the same CAD negative impact as the dual trade reports did on Tuesday," says Camilla Sutton at Scotiabank.

A weak trade report from Canada juxtaposed against a strong trade balance from the US reminded markets of the uncertainty that overhangs the Canadian export market as exports have so far failed to recover to the extent that many had hoped and as the impact of increased US oil production poses to the Canadian oil sector.

We forecast further CAD weakness in coming sessions in line with the observation the the currency has been the worst performing primary currency thus far in 2014.