Daily Economic Commentary: Switzerland

It seems like the CHF bulls are finally getting tired. USDCHF gained 7 pips from yesterday’s range play, marking the CHF’s second loss in a row after completing an 8-day winning streak.

With the US holiday keeping market players away, the CHF was unable to make any big movements. The CHF wasn’t even able to capitalize on news of Switzerland’s awesome retail sales. The report showed a 3.8% increase in retail trade in May, blowing right past the forecasted 2.7% uptick and the previous month’s record of a 1.3% increase. Maybe the bulls really were too exhausted to charge!

USDCHF still traded in the Swiss turf yesterday as it closed at 1.0595. However, I couldn’t say the same for EURCHF. The pair traded above the 1.3350 yesterday after reports indicated that the big bad D-word (deflation) could be back in Switzerland.

The Swissy has enjoyed a strong pip run against the euro since the SNB announced that deflation is no longer a problem. But yesterday’s CPI data, which printed at -0.4% in June, led many to think that the SNB had its p-p-p-poker face on when it made the deflation announcement. Traders are now up on their toes looking out for any sign of intervention from the bank.

Does this mean that we’re going to see more spikes on the Swissy pairs again? Oh man.

There are no Swiss announcements left on our awesomely redesigned super sexy calendar, but if you’re making ‘em Swissy trades, make sure to gauge risk sentiment as the franc tends to appreciate with a rise in risk aversion.

I have good and bad news for you, my franc bulls! The good news is that the franc gained across the charts yesterday after the poor economic reports from the euro zone reduced risk appetite in the market. The bad news is that our favorite Swiss cheese and Swiss chocolates just got more expensive.

Weaker than expected German machinery orders and French trade balance reports sent the euro-averse traders scurrying to the safety of the Swiss franc, consequently pushing EURCHF and USDCHF to new monthly lows.

Only the unemployment rate will be published today at 5:45 am GMT. Joblessness in the country is expected to decline by another 0.1% after falling by the same rate last May. If we see a bigger fall later, we could see EURCHF and USDCHF post new sets of monthly lows again.

And that’s how you score a hat trick! For the third day in a row, the Franc pounced on the dollar to forge a new 14-week low. USDCHF fell to 1.0497, down 19 pips for the day.

Judging by its recent climb, it seems like the Franc is still capitalizing on the USD’s weakness. It also received a bit of support when Switzerland published its June unemployment rate. Even though it was widely expected, the rate of 3.7% still wowed the markets as it marked an improvement from the previous month’s record of 3.8%.

No Swiss economic data on deck today. For now, it might be wise for you to monitor risk sentiment since bouts of risk aversion usually boost the safe-haven Swissy.

The Swissy finally lost to the dollar as USDCHF traded higher on Friday. The pair opened just below the 1.0500 handle, eased to the day’s high at 1.0593 and closed the week at 1.0557.

We don’t have anything from Switzerland today. Sigh. How I wish Octopus Paul would make predictions on the Swissy too. We’re always short of Swiss reports. Boo hoo!

Thank goodness we have the data on producer and import prices on tap tomorrow at 3:15 GMT to help us in our Swissy trades. The reading for May was 0.3%, if it prints higher than that we may just see the currency go on another bullish rally.

The franc danced to the tune of Jay Sean’s “Baby are you down down down down down….” after the currency lost against the majors yesterday. EURCHF closed at 1.3358 after soaring to an intraday high of 1.3413, while the USDCHF reached an intraday high of 1.0677 before ending the day at 1.0604.

Some say that the franc weakness was due to profit-taking from last week’s gains, but others are also speculating that it was the dollar’s strength that brought the franc down.

In any case, Switzerland will have a chance to make its own headlines today when the monthly producer price index is released at 7:15 am GMT. The price index is estimated to increase by 0.2% in June compared to May’s 0.3% growth, but a higher than expected figure might signal that producer demand is healthy despite the franc’s appreciation.

Though the CHF was bullied by most of the other majors yesterday, it managed to push around the Greenback. In the end, USDCHF ended 58 pips lower for the day at 1.0548, with much help from poor US data.

Overall, risk appetite made the CHF as appealing as roadkill to investors hungry for higher-yielding assets.

The June PPI report didn’t provide much of a lift either. Instead, it added to the CHF’s woes by posting a 0.4% decrease in the price of goods and raw materials purchased by manufacturers. Not only is this a big drop from the 0.3% uptick in May, but it also falls extremely short of the 0.2% increase that was predicted. Investors usually look to this report as an indication of future inflation since manufacturers usually pass on higher input costs to consumers.

You hear that? That’s the sound of silence in Switzerland! Since no hard-hitting economic releases are due today, you ought to stay sharp and get a feel for risk sentiment, since it usually determines the CHF’s movements in the absence of reports.

The Swissy was able to somehow turn ‘em dollar bulls into bears yesterday. USDCHF traded higher during the Asian session after opening at 1.0548. It peaked at 1.0618 when the London session started but traded downwards for the remainder of the day and closed at 1.0535. Who says the dollar can’t be tamed?

We don’t have anything to worry about the Swissy with regard to economic reports. But there is a lot of data on tap for the dollar so you may want to tune in to them if you’re planning to trade USDCHF. Good luck and happy trading!

The franc traded with mixed results yesterday after the positive sentiment in the euro region boosted EURCHF, but the depressing economic reports from the US sent the dollar bulls to the low-yielding franc. EURCHF ended the day 66 pips higher at 1.3479, while USDCHF plunged to 1.0410 from its 1.0526 open price.

The ZEW economic expectations released yesterday might have supported EURCHF’s ascent when it showed a sharp contrast from the recent positive economic reports from the country.

The survey showed that the investors are concerned that the global recovery will slow down until the end of the year. This was reflected by the data’s drop to 2.2 from June’s 17.5 index figure.

No reports will be released today, but keep your eyes out for any shifts in risk sentiment! Will the red flags in the US send more bulls in the franc’s direction, or will the euro rally continue to weaken the currency? Happy trading!

The Swissy’s got a Swiss mountain to climb if it wants to get out of this ditch! It dropped like a rock against its US counterpart as USDCHF encountered major resistance in the area of 1.0500. In the end, the pair closed at 1.0516, marking a 96-pip climb for the day.

With no reports issued from Switzerland, it seems like investors abandoned the Swissy last Friday. Judging by the results on the charts, the Swissy wasn’t able to escape the clutches of risk sentiment and fell victim to risk aversion, just like the other major currencies.

In other news, the Swiss press is going ninja on us again this week! The only report on deck is the trade balance data due on Tuesday at 6:15 am GMT. Switzerland recorded a 0.82 billion CHF surplus in May, which most expect to grow to 1.05 billion CHF in June. An expanding surplus usually means foreigners are buying more CHF to pay for Swiss exports. With this in mind, the Swissy may just crawl out of its current dip if the report prints an upside surprise.

But with only a single Swiss report scheduled for release this week, you may have to rely on your risk sentiment sensors to guide the way for the rest of your USDCHF trades. Good luck out there, soldier!

The lack of market-moving news may have kept the Swissy from skiing up the charts yesterday. Save for the yen, the currency lost against most of its major counterparts. GBPCHF, USDCHF and EURCHF and traded higher and closed the day costing the Swissy 35, 55 and 111 and pips, respectively.

Switzerland’s trade balance data is set to be released today at 6:15 am GMT today. It is expected to have risen to 1.05 billion CHF in June following the 82 million CHF increase in May. The Swissy may get a break from the bearish attacks if the report prints better than the consensus, so tune it to that.

Good day for them Swiss bulls yesterday eh? The franc popped higher against both the euro and dollar, with EURCHF and USDCHF closing 88 and 25 pips lower respectively.

Now who says that goods have to be cheap to be in demand? Switzerland beat the odds yesterday by posting a strong trade balance report in June despite the aggressive appreciation of the franc.

Apparently the strong demand for the Swiss watches and metals boosted the exports by 8.2% to 95.99 billion CHF. Imports, on the other hand, also grew by 7.7% to 86.09 billion CHF.

No other Swiss data is scheduled for release this week, but stay sharp on the risk appetite battle in the markets! Will risk appetite boost the comdollars, or will risk aversion drive traders to the low yielding franc?

The Franc must be a big fan of DJ Khaled’s because it was singin’ “All I do is win!” all over the charts yesterday! It was one of the biggest winners during yesterday’s trading sessions, gaining against almost all of the other major currencies. It was even able to squeeze out a narrow win over the Greenback as USDCHF fell 21 pips to close at 1.0504.

The Franc’s buddy, mix master Risk Aversion, provided the wicked sick beats for its victory song. The two made an awesome performance after US Fed chairman Bernanke hit the stage and scared everyone off with his grim outlook for the US economy.

The newswires will be silent again in Switzerland today. But don’t fret! The Franc might sing another tune with Risk Aversion if risk sentiment turns sour again later. Big Ben Bernanke is scheduled for an encore performance at 1:30 pm GMT, and might just send the Franc to the top of the charts if he belts out another pessimistic song.

USDCHF traded down the charts yesterday after it opened just above the 1.0500 handle and reached the day’s low at 1.0395. However, the mighty Swissy, as I like to call it, wasn’t able to push the common currency further below the 1.0400 handle, and closed the day at 1.0430.

No economic yodel-eeh-ooohs came from Switzerland yesterday so I’m guessing the Swissy’s bull rally was courtesy of risk appetite’s comeback. However, I wonder if the currency’s run will still continue today.

We still don’t have any Swiss report on tap, but we do have the EU Stress Test results due later so stay tuned to that! Good luck on your trades!

It’s a TKO! The franc got boxed out of the pip-ring last Friday after a strong punch of risk appetite knocked the franc down against the euro, dollar, and even the yen. EURCHF hit the hardest with its 168-pip gain from its open price at 1.3605.

The lack of data from Switzerland made it vulnerable to the attacks of risk appetite last Friday. The positive German IFO report and better than expected EU stress test results from euro zone woke up the currency bulls that headed straight for the high-yielding currencies and away from the low-yielding franc.

The Swissy will resume its fighting stance tomorrow when the UBS consumption indicator is released at 6:00 am GMT. A figure higher than May’s 1.73 index number might show that local consumers are still willing to spend despite the global economic uncertainty.

Meanwhile, the KOF economic barometeris scheduled on Friday at 9:30 am GMT. The index is expected to increase to 2.30 in July after printing at 2.25 last June, but a higher figure might mean that growth and optimism remains healthy in Switzerland.

“Welcome to the party!” said the other major currencies to the Franc. It walked on over to the winners’ side of town yesterday as it started the week strongly against the USD, forcing USDCHF to fall from its opening price of 1.0552 and land at 1.0483.

It seems even the Franc benefited from the improved risk sentiment that hung in the air yesterday. Judging by the confidence they showed, it looks like investors are risk hungry once again. Have fears finally been calmed by the euro stress test results? Perhaps the risk-taking was a result of the positive US data. Hmm… Then again, it’s probably a combination of both!
Well, well, it looks like today’s your lucky day! Why, you ask? You get a rare taste of Swiss news!

Due at 6:00 am GMT is the June UBS consumption indicator, which gauges consumer confidence and spending. Ready your trigger fingers, bulls! You could be in for a bull run if the report posts an improvement from the 1.74 reading given in May.

Swissy-who? Investors seem to have forgotten the Swissy in yesterday’s trade as it lost to most of its rivals. USDCHF skyrocketed up the charts during the London session breaking past 1.0500 and 1.0600 handles. It reached the intraday high of 1.0641 before it closed the day at 1.0602.

  But for all you Swissy bulls out there, don’t worry. You’ll probably get some pip-lovin’ when economic reports from Swissy’s counterparts come out worse than expected and when risk aversion kicks in. I wouldn’t hold your breath if I were you though.

The Swissy gained back some of its groupies yesterday after risk aversion took center stage in markets and turned the spotlight to low yielding currencies. EURCHF closed the curtains at 1.3723 after an intraday high of 1.3819.

Switzerland will take the backstage once again with no economic reports today, but keep an eye out for any reports that could provide a twist to the drama of risk appetite in markets. Break a leg in your trading!

Bust it Swissy! The Swissy sped through the piplane fueled by rumors of an intervention from the SNB and by optimism on the nation’s leading economic indicators. It reached its week’s high against the euro at 1.3509 and its five-month high against the dollar at 1.0362. Boo yeah!

Word in the market was that the SNB was selling some of its dollar reserves which might have tripled during the past year in its efforts to weaken the franc. The rumor might have helped the currency run at full-speed because this implies that the SNB not worried about the Swissy’s strength anymore.

However, it stopped short of its tracks as the KOF leading indicator index printed lower than its 2.3-forecast at 2.23. The currency ended the day only with a 45-pip win against the euro and a 3-pip loss against the dollar.

Let’s see if the Swissy can step on the pip-pedal and get back to the bulls’ love with today’s reports. At 7:15 am GMT, the Federal Statistical Office will announce Switzerland’s retail sales figures for June. If the actual number is better than the 4.1% forecast, then we may just see the Swissy rally again. Whoot whoot!

But don’t be too sure of the Swissy just yet! Analysts aren’t as optimistic on the country’s manufacturing sector as they are on consumer spending with July’s manufacturing PMI forecast lower at 64.7 from its 65.7 reading in June.

Watch out for these reports as they may guide the Swissy on its trip on the charts today!

Ka-chow! The Swissy was blinded-sided by economic data from within its own borders, leaving the franc with mixed results in yesterday’s trading. EURCHF rose 100 pips from its opening price to close just below the 1.3700 handle, while USDCHF closed 11 pips lower at 1.03888.

The major data that rocked franc pairs was the release of retail sales data. On a year on year basis, sales rose by 0.9%. Sounds okay right? Well, not if everyone was expecting a figure of 4.1%! The disappointing figure hinted at potential weakness in the Swiss economy. Hmmm… could the franc’s recent appreciation be affecting sales?

In other news, the SVME PMI report gave the markets a nice surprise, printing a score of 66.9. This was much higher than the forecasted reading of 64.9, and beat last month’s score of 65.7. This indicates that the manufacturing sector is improving.

Watch out today when CPI data comes out at 7:15 am GMT. On a yearly basis, prices are expected to have increased by 0.7%. Still, I don’t think this report will have too much impact on the markets, so better watch out for data coming out from other countries as a clue as to which way the Swissy will sway today.