Daily Economic Commentary: Switzerland

After USD/CHF’s slow and choppy movement last Friday, the pair decided that it was time to get up and shake things up yesterday! From the pair’s day open price at .8856, it had dropped to an intraday low of .8773 before it rose back up to close the day slightly lower at .8808.

The major headline yesterday came from Portugal. Despite the austerity measures it has implemented, Portugal admitted that its budget deficit will exceed the 9.1% of GDP the market expects. The news worried the market, which gave the chance for CHF to rally across the board.

Today, at 6:00 am GMT, UBS consumption indicator and Switzerland’s trade balance will be published.

Last month, the UBS consumption indicator printed a reading of 1.46. If the figure later comes in higher, we could see CHF post more gains. The trade balance, on the other hand, is expected to show that the country’s surplus went down to 2.27 billion CHF from 2.38 billion CHF. Normally, the trade balance doesn’t have much of an effect on the CHF’s price action, but still do be careful!

Despite mixed data from Switzerland, the Swissy was still able to tap a new all-time high against the dollar (for what seems like the gazillionth time) at .8746. It then settled at .8758 at the end of the day with a 50-pip win.

The Swiss trade balance report for March showed that the trade surplus narrowed to 1.09 billion CHF from 2.38 billion CHF in February. It also disappointed expectations as analysts expected to see exports outpace imports by 2.27 billion CHF.

On the brighter side of things, the UBS Consumption Indicator for March showed that consumer confidence and spending improved during the month. The index came in higher at 1.66 compared to the 1.45 reading we saw for February.

It seems to me that the Swissy’s moves on the charts are dictated by market sentiment. So make sure you gauge how the market is feeling before you decide to go long or short on the currency! If the dollar weakness continues, we may see USD/CHF tap a new low once again!

If you’re a fan of see-saws, then you must’ve enjoyed trading USD/CHF yesterday! The pair fell below .8700 major psychological handle early during the Asian session, but quickly recovered and rallied .8834. At the end of the day, USD/CHF was at .8738, just 21 pips lower from its opening price.

Similar to yesterday, Switzerland’s economic calendar has nothing in store for us today. This means that USD/CHF’s price action will be driven mostly by data coming out of other regions, especially those from the U.S. Keep an eye out on the results of the U.S. advance GDP report at 12:30 pm GMT, as will have a hefty impact on market sentiment.

The Swissy looked just like a crab the way it traded sideways yesterday! Even with the U.S.'s GDP release, USD/CHF stayed in consolidation, closing just 6 pips lower at the end of the day.

If U.S. data can’t get USD/CHF to move, then maybe some words from SNB Chairman Hildebrand can! At 8:00 am GMT, the central bank head is due to speak. Will he talk about the Swissy’s strength and hint about an intervention? You’ll just have to tune in to find out!

Also on tap today-- the KOF economic barometer! Forecasts have the index ticking down from 2.24 to 2.20. If the report prints any surprises, it might be enough to get Swissy traders back into action, so be sure to catch it at 9:30 am GMT!

Thanks to hawkish comments from SNB President Philipp Hildebrand and a very positive KOF economic barometer, the Swissy was able to stage a magnificent rally versus the Greenback last Friday. USD/CHF dropped almost 90 pips from its open price and ended the day at a new all-time low at .8650

According to Hildebrand, price stability could be threatened if commodities prices go higher, the franc weakens, and the central bank continues with a loose monetary policy. Meanwhile, the KOF economic barometer printed a reading of 2.29, higher than forecast and the previous month’s reading.

Switzerland’s retail sales report and the SVME PMI are the only important data releases this week. The first one, the retail sales report will come out at 7:15 am GMT today. It is expected to show a gain of 2.5%. Following at 7:30 am GMT is the KOF economic barometer. The KOF economic barometer is predicted to print a reading of 58.8 for April, slightly lower than March’s 59.3.

Despite the worse-than-expected economic reports that came out from Switzerland, the franc managed to clock in mixed price action against its major counterparts. Though USD/CHF was almost unchanged at .8651, EUR/CHF rose by 10 pips to 1.2827. Meanwhile, GBP/CHF dropped by 64 pips to 1.4406.

Economic reports released from Switzerland yesterday showed that retail sales slipped by 0.2% in March when market junkies were expecting a 2.3% rise. Then, the SVME PMI, an index of purchasing manager sentiment, showed a drop to 58.4 from its 59.3 reading in April. Remember that a reading below 50.0 signals industry contraction.

No other economic reports are due from the land of the Swiss Alps today, but make sure you keep close tabs on any report that might affect risk sentiment! If you’ve been reading the best forex education site, then you’ll know that the low-yielding franc usually benefits from risk-averse environment.

Let’s go, Swissy, let’s go! The Swiss franc chalked up another day of gains against the Greenback as USD/CHF reached the .8600 area. The pair opened at .8656, reached a low of .8596, before closing at .8616. Could the franc extend its winning streak today?

Risk aversion in the markets yesterday proved to be more beneficial to the Swissy than to the U.S. dollar. Will the real safe-haven currency please stand up?

Switzerland won’t be releasing any economic data today, which means that USD/CHF price action could depend on market sentiment and U.S. economic reports. Make sure you check out my daily economic commentary on the U.S. as well!

Even an episode of Gardening 101 is more exciting than franc’s price action yesterday! USD/CHF ended the day in a draw at .8616, while EUR/CHF also came back to its open price at 1.2780. Will today be another snoozer for the franc?

No economic reports are scheduled today in Switzerland, but make sure you guys stay on top of your trades by staying glued to the tube for any reports that might affect risk sentiment! As the readers of the best forex education site on the planet know, the low-yielding franc usually benefits in a risk-averse environment.

It looks like the Swiss franc’s happy days are over as it gave way to Greenback strength yesterday. USD/CHF started the day at .8617, dipped to a low of .8557, only to jump back to the .8700 area.

The Swiss franc joined the euro in its nosedive after ECB President Jean-Claude Trichet’s dovish comments during their rate statement. Top that off with poor U.K. services PMI and a huge drop in German factory orders. With all these weak spots in Europe, it’s no wonder traders flocked back to the safe-haven arms of the U.S. dollar!

The only report due from Switzerland today is its unemployment rate, which is expected to have dipped from 3.3% to 3.2% in April. If the actual figure meets expectations, it could give the franc a chance to rebound from yesterday’s drop. Make sure you keep your eyes and ears peeled for that report due 5:45 am GMT today.

Oh, and before I forget, brace yourselves for some fireworks later on when the U.S. releases its NFP figure. You might wanna read up on what our resident economic guru Forex Gump has to say about the upcoming employment report!

Switzerland may have posted awesome employment data of its own, but the Swissy was no match to the U.S.’s NFP report! Its rally was short-lived as the NFP pushed USD/CHF up the charts to close 59 pips higher for the day.

Time to whip out your best Swiss cheeses ‘cause we’ve got something to celebrate in Switzerland! Instead of just falling by 0.1% as predicted, the unemployment rate plummeted from 3.3% to 3.1% last month, bringing it to its lowest point in over two years! Boo yeah! It appears that employment has been on the rise as exporters have been hiring like crazy to meet demand for their products.

If you’re wondering if this week will have more good news in store for our buddies up in Switzerland, you’ll have to wait until tomorrow to find out.

The SECO consumer climate report is due at 5:45 am GMT and, according to forecasts, it’ll probably print a reading of 10 again.

A few minutes after that, at 7:15 am GMT, Swiss CPI data will be available. Now, y’all know from reading Forex Gump’s articles that deflation has been a big pain in the neck for Switzerland. That being said, Swissy bulls might just paint the town red if we see a figure better than the 0.5% uptick that’s forecasted, or even the 0.6% figure we saw the previous month!

And the Swissy’s back in the game! After a couple of days of losing against the Greenback, the Swiss franc got back on its feet and erased some of its recent losses. USD/CHF opened at .8791, dropped to a low of .8717, then closed at .8719.

Switzerland didn’t release any economic data yesterday but news of Greece’s downgrade sent traders fleeing to the safe-haven arms of the Swissy.

Today, Switzerland will report its SECO consumer climate reading for the past three months. The reading from February to April is expected to stay at 10, which would indicate that consumers are still confident with their economic outlook. An even higher figure would be better for the Swissy because it would imply that consumer confidence improved during the period. Watch out for the actual figure due 5:45 am GMT.

Later on, Switzerland will release its CPI reading for April. Price levels are expected to have risen by 0.5% during the month, slightly slower than the 0.6% rise seen last March. If the actual figure comes in weaker than expected, it could spell another losing day for the Swissy so make sure you keep tabs on the CPI release at 7:15 am GMT.

There she goes again! After posting nice gains on Monday, the Swissy went back to sliding down the charts on bad data and improved risk appetite. It lost out against its two biggest counterparts as USD/CHF rose 89 pips and EUR/CHF leapt 168 pips.

Risk taking was back in style yesterday, which partially explains why the Swissy was down in the dumps. But aside from that, it also had to deal with disappointing Swiss data!

For one, the SECO consumer climate report seems to be saying that the economy is cooling down. Instead of printing a repeat of the previous month’s reading of 10, it caught traders off guard and printed a reading of -1! Yeeouch!

The CPI report was also a big downer as it failed to deliver the 0.5% uptick that markets had anticipated. Inflation was only at 0.1% last month, a big drop from March’s solid 0.6% figure.

No more reports comin’ out of Switzerland today! For now, keep risk sentiment in check ‘cause y’all know how the Swissy loves to boogie to the beat of risk sentiment!

What the heck? Not even the mighty Swissy could benefit from yesterday’s risk aversion run? USD/CHF closed the day higher at .8871, up 63 pips from its opening price. What gives?

Just like its European counterparts, the franc lost against the dollar, which was a little surprising since franc has been the ultimate safe haven currency in 2011. With the sell-off in riskier assets yesterday, one would think that the franc would benefit nicely, even against the Greenback.

But nope, that’s not what happened! What a strange world we live in eh?

No data on tap today, but keep an eye out for the U.S. retail sales report. This could cause some sparks in market, so be careful out there!

It’s a strong finish for the Swissy! The Swiss franc lagged behind the Greenback during the Asian and London sessions as USD/CHF tapped the .8900 level then. Determined to end the day with a win, the Swissy managed to muster enough strength to push USD/CHF to close at .8845. With a bunch of red flags on today’s schedule, we might be in for a repeat of this exciting price action today!

Since Switzerland didn’t release any economic data yesterday, risk aversion which resulted from disappointing Australian jobs data brought traders back to the safe-haven Greenback. However, weak data from Uncle Sam himself led traders to abandon the U.S. dollar in exchange for other currencies such as the Swissy.

Switzerland is set to report its April PPI figure at 7:15 am GMT today. The report is expected to show another 0.4% uptick in producer price levels, following the 0.4% increase seen last March. Since higher producer input prices could lead to stronger inflationary pressures, a better than expected PPI figure could bring the SNB closer to tightening monetary policy. And, as we all learned in the School of Pipsology, an interest rate hike or the mere prospect of it is usually bullish for the currency.

Even the mighty franc couldn’t overcome dollar strength! USD/CHF rose a good 82 pips to end the week at .8927. With the pair now approaching a key support and resistance level, can the franc bulls regain their bearings?

Part of the franc’s losses may be attributed to the producer price input report, which came in a slightly disappointing. The report showed that producers were paying just 0.3% higher for their raw materials, a little less than the expected 0.4% figure. What this means is that inflation isn’t so much of a problem right now, which gives the Swiss National Bank less reason to raise interest rates.

Still, I think Friday’s movements were mostly a dollar move. The dollar’s decline was for the most part overextended, so a retracement across the board was expected. The question is, now that USD/CHF has retraced a bit, could we see the franc bulls re-establish their positions this week?

The Swiss franc is off to a good start! Thanks to risk aversion, it ended Monday with a 99-pip gain against the dollar and a 45-pip against the euro. Oooh, they got nothing on you Swissy!

Worries about Euro Zone’s sovereign crisis amid the absence of IMF Director Strauss-Kahn and the U.S. hitting its debt ceiling might have highlighted the Swissy’s safe haven reputation in yesterday’s trading.

Our forex calendar still has nothing on tap from Switzerland today so make sure you also pay attention to s’hapnin to its counterparts. Good luck!

Make that two in a row! With the dollar slumping across the board, USD/CHF posted its first back-to-back drop in over two weeks. The pair managed to close another 28 pips lower, finishing at .8811.

Nothing on the docket today, but be careful trading during the U.S. session, as the FOMCminutes will hit the markets at 6:00 pm GMT! This report could rock the markets depending on what was discussed. It might be best to sit on the sidelines and wait this one out!

After struttin’ through the charts with swagger for the past couple of days, the Swissy ended yesterday’s trading unchanged against the Greenback and with an 14-pip loss to the euro. Uh oh, could it be in trouble?

Perhaps the Swissy bulls lack the inspiration to hustle some muscle without any economic report on tap from Switzerland. But don’t worry! Today we’ll have the ZEW Economic Expectations report for May at 9:00 am GMT.

A reading higher than the 8.8 figure we saw for April would probably be bullish for the Swissy as this would mean that investors and analysts see economic conditions are improving in the country. So watch out!

You could sum up USD/CHF’s price action in three words (two if you want to be critical about it): Down, up, down! If you look at USD/CHF’s price action yesterday, you’ll see how the pair fell early in the Asian session, suddenly popped back up during the European session, and then dropped down again once the U.S. trading session began. At the end of the day, the pair was at .8806, barely changed from its day open price at .8812.

The only important piece of data released yesterday was the ZEW economic expectations survey. Last month, it managed to print its first positive reading in seven months, but it seems like that was just a fluke. Yesterday, the survey plunged back into negative territory as it printed a -11.5 figure.

Nothing on Switzerland’s forex calendar, so don’t expect the Swissy to exhibit a lot of volatility. Alright, that’s it for this week! Have a great weekend folks.

The Swissy posted a 156-pip win against the euro on Friday. Sha-bam! Now that’s how you end the week with a bang! EUR/CHF tumbled from its intraday high at 1.2648 and closed the week at 1.2446.

It didn’t post a hefty win against the dollar as USD/CHF closed a mere 15 pips lower from its opening price. But eh, a win is still a win, right?

Renewed concerns about the euro zone’s debt crisis and the roster of worse-than-expected reports from the U.S. (existing home sales, leading indicators, and manufacturing) must have highlighted the Swissy’s safe haven reputation and had traders scrambling for it.

So without anything on tap from Switzerland today, you may want to keep tabs on the reports we have on tap for the Swissy’s counterparts. Looking at our forex calendar, it looks like we have a handful of data coming out for the euro. Good luck!