Given floating exchange rates, a simultaneous decrease in the Canadian demand for British products and an increase in the British desire to invest in Canadian government securities would cause a ...

1. appreciation of the pound against the Canadian dollar
2. depreciation of the pound against the Canadian dollar
3. appreciation of the pound against the Canadian dollar only if the effect of the first event is larger than the effect of the second event.
4. depreciation of the pound against the Canadian dollar only if the effect of the first event is larger than the effect of the second event
5. depreciation of the pound against the Canadian dollar only if the effect of the second event is larger than the first event.
7. My thoughts are with item 2. FX markets not aware of Canadian Govt desires.