Daily Economic Commentary: Switzerland

USD/CHF dove back below the .9300 handle yesterday as the FOMC statement weighed on the Greenback. The pair dipped to a low of .9243 before ending the day at .9258. Will the selling pressure force USD/CHF to break below the .9250 support zone?

During the U.K. session, the Swissy got a boost from an improvement in its ZEW economic expectations figure as it climbed from -27.9 to -15.5 in November. This indicates that investors and analysts are less pessimistic about Switzerland’s economic prospects for the next six months as Europe showed progress when it comes to solving the ongoing debt crisis.

The franc got another boost during the U.S. session when the FOMC announced that they’d link their interest rate to the U.S. jobless rate and extend their asset purchases by 45 billion USD in January. This triggered a strong dollar selloff as the prospect of low interest rates and increased liquidity dampened demand for the Greenback.

Today, it’s the SNB’s turn to make their rate decision. The Swiss central bank will make their monetary policy statement at 9:30 am GMT and they aren’t expected to make any changes to their interest rates. Still, this report could spur volatility for USD/CHF so stay on your toes during the event in case you have a Swissy trade!

Talk about being a party pooper! Instead of rockin’ the markets with comments about the EUR/CHF peg, the SNB chose to focus on its growth and inflation forecasts. As a result, EUR/CHF dropped 32 pips from its opening price to finish at 1.2079.

Some market players were expecting SNB officials to make new comments about a raise in the EUR/CHF peg, which is why many traders paid attention to the SNB statement. However, the central bank decided to keep the peg steady at 1.2000, and instead revealed its growth and inflation forecasts for 2012 and 2013.

In 2012, Swiss GDP is projected to grow 1% and is projected to accelerate by another 1.5% in 2013. Inflation however, is expected to clock in at -0.7% this year, and slowly climb up to -0.1% in 2013.

Our buddies over at the SNB also expressed some concern about the state of the euro zone, and the significant impact it could have on the Swiss economy down the road.

Lastly, the SNB did acknowledge that the continued rise of the franc could spell disaster for the Swiss economy should it continue to appreciate in value. Could the central bank be setting the groundwork for a raise in the peg in 2013? I’m not sure, but we’ll have to wait a few weeks to find out!

Way to go, little Swissy! The Swiss currency pocketed more gains against the Greenback on Friday as USD/CHF slipped below the .9200 mark at the end of the week. Will it continue to trade lower this week?

As it turns out, weaker than expected U.S. inflation reports triggered another round of dollar selling as traders recalled the most recent FOMC decision, which involved linking the benchmark rate to the inflation rate. The weak CPI for November just means that the Fed won’t be hiking rates anytime soon!

Only Switzerland’s trade balance and the SNB’s quarterly bulletin are due from Switzerland this week so there might not be a lot of volatility for Swissy pairs. Be mindful of any shifts in risk sentiment though as this could drive the franc’s price action for most of the week!

We got mixed results from the Swiss franc to start the week, but overall, it wasn’t very impressive. While it lost 4 pips against the dollar and 45 pips against the pound, it snatched up 6 pips against the euro. Let’s see if it can put up a better fight today!

Nothing new from Switzerland yesterday… it pretty much danced to the beat of risk sentiment! And so far, it’s not acting like the safe haven that it once was, as it’s having difficulty posting gains against its higher-yielding counterparts.

Once again, nothing on tap today, so it’s probably best that you keep tabs on the market’s risk appetite. From the looks of it, a risk-on environment will probably give the Swiss franc a boost, at least against the dollar!

After stalling around its week open price for a day, USD/CHF resumed its slide as it dipped to a low of .9124 then closed at .9137, 42 pips below its open price. How low can this pair go?

Switzerland and the U.S. didn’t release any economic figures yesterday but the Swissy was able to benefit from the news that the U.S. continued to make progress when it comes to having a plan for the looming Fiscal Cliff. On top of that, S&P’s decision to upgrade Greece’s credit rating by six notches gave the European currencies a strong boost.

There are no reports due from Switzerland today so make sure you keep close tabs on risk sentiment and updates on the U.S. Fiscal Cliff negotiations to figure out where USD/CHF could be headed. Positive news from the U.S. could keep risk aversion at bay, which suggests that USD/CHF could dip even lower.

USD/CHF continued to head into bear lair as it slipped another 17 pips to .9120. Meanwhile, EUR/CHF ended the day virtually unchanged at 1.2081 after rallying as high as 1.2103. Where will the markets take the Swissy today?

No reports from Switzerland yesterday, but today it’ll break its silence with some trade balance figures. At 7:00 am GMT, we’ll take a look at last month’s trade results, which is expected to show a surplus of 2.21 billion CHF, down from 2.73 billion CHF in October.

Also, for those of you planning to trade USD/CHF, remember to check out the reports the U.S. will be rolling out in the NY session. It could very well determine if the pair will continue its bearish streak!

With no major data on tap, USD/CHF chilled out and stuck within its average daily trading range. By the end of the day, the pair had formed a near perfect doji on the daily chart, closing at .9119.

No biggies on the docket once again, so we may just see more ranging from franc pairs today. Of course, with the holidays coming up early next week, who knows what will happen today! Good luck trading, homies!

Over the break, the Swissy was as calm as a cat, as it traded just between .9150 and .9100 against the dollar. Against the euro, it was just as chill with EUR/CHF ranging just below 1.2100. The question now is, will it finally come to life today or will the inactivity of the break carry over into 2013?

Not much happened in Switzerland over the break, which explains why the Swissy has been sleeping like a log as of late. But now that the new year is here, we have hope for some action!

Though Swiss banks will be closed in celebration of Second New Year’s Day, U.S. and other European banks will open shop again and this could result in some serious volatility in the markets. Also, tomorrow we’ll get our first taste of Swiss data this 2013 in the form of the SVME PMI report, which is set to tick up from 48.5 to 48.7.

The year 2012 sure is a tough act to follow, but I’m totally psyched to see how the Swissy will start the year. In any case, if you’d like to learn more about what to expect from the Swiss currency this 2013, check out Forex Gump’s 2013 preview on the European currencies!

After starting the day off on a tear, the Swiss franc lost steam heading into the New York session and not only lost all its gains but took a hit as well! USD/CHF hit a low of .9079 before reversing and rising up to finish at .9186, up 26 pips from its opening price.

Today, we’ve got a couple of second tier reports that could help the franc bulls get back on track.

First, the KOF economic barometer will hit the airwaves at 8:00 am GMT. Early estimates are calling for the index to print at 1.39, which would be lower than the 1.50 reading we saw last month.

Later on at 8:30 am GMT, the SVME PMI will be available. Expectations are that the index will come in at 48.7, showing just a slight improvement from the 48.5 score the previous month.

Should both these reports come in exceedingly better than expected, it could provide the franc bulls some momentum to end the day with a victory.

Alas! The franc spent another day in the bear lair. USD/CHF continued to trade higher yesterday. It opened at .9186 and finished the day at .9261.

Without any economic data from Switzerland, the franc was left vulnerable to the dollar’s advances. As you probably know by now, the FOMC revealed that American central bankers are thinking about withdrawing some stimulus this year.

Our forex calendar is once again blank for reports for the franc today. This probably means that U.S. data will determine whether or not the currency spends another day in the bear lair. So make sure you’re on your toes for the NFP report!

That .9300 handle held like a champ, baby! After briefly testing the .9300 mark, USD/CHF came crashing down to finish at .9250. Now that we’re seeing shooting star on the daily chart, could the pair be on the way back down?

We could be in for a topsy-turvy day of trading for franc pairs, as the SNB will be releasing data about its current level of foreign currency reserves. The total amount of reserves that the SNB holds has risen over the past few months, as the central bank has sworn that it will protect the EUR/CHF peg no matter what. That said, don’t be surprised if we see another figure above 400 billion CHF.

Franc bulls must’ve felt like they were on top of the world in yesterday’s trading as the currency was able to strike a win against the dollar. USD/CHF closed the day lower at .9213 after opening at .9242.

Market sentiment was on the side of the franc yesterday as traders anticipate the U.S. earnings season. We might see the earnings reports continue to dictate the currency today with only the unemployment rate report on tap at 6:45 am GMT (the forecast is at 3.0%) so make sure you keep an ear out!

As the old adage goes, “No pain, no gain.” Unfortunately for the Swissy, it only got the first part of the memo. It got all the pain, but absolutely no gain at all. USD/CHF, which started off the day at .9216, finished 32 pips higher at .9240.

Even though nothing really bad happened in Switzerland yesterday, the domestic currency still lost as it was dragged down by disappointing data from the euro zone. It was reported yesterday that retail sales in the euro zone failed to meet consensus as it showed a minute 0.1% increase instead of 0.3%. In addition, German factory orders fell by 1.8%, opposite the 3.8% increase seen the month before.

No data scheduled to be published again today from Switzerland but I think we’ll still see a lot of action in the charts since both the Bank of England (BOE) and the European Central Bank (ECB) will be announcing their decision on interest rates today. These are market-moving events that could indirectly affect the Swissy’s price action.

Still no lovin’ for the franc! Just like the rest of the major currencies, the Swiss franc was no match to the dollar in yesterday’s trading. USD/CHF finished higher for a second day higher at .9252 after kick-starting the day at .9241.

But don’t fret! With the ECB rate decision scheduled today, there’s a chance for us to see the franc catch a break from the bears’ advances. Keep an ear out for positive remarks on the EZ economy from ECB head honcho Mario Draghi. Given the close proximity of Switzerland to the euro zone, a positive outlook on the region’s economy could also be good news for the franc.

Now that’s how you stage a performance! With risk appetite making its way back into the foreign exchange market, the Swissy soared higher versus the safe haven Greenback. All in all, the Swissy managed to gain 115 pips over the Greenback.

As I mentioned in my other updates, the risk appetite was the result of the better-than-expected trade balance from China and the solid bond Spanish bond auction. In China, the trade balance showed a huge 31.6 billion CNY surplus for the month of December. Analysts had only expected a 20.1 billion CNY surplus.

Switzerland’s consumer price index will be published later today at 8:15 am GMT. It’s anticipated to show that the average prices of goods and services have fallen 0.1% in December. In the month prior, the CPI showed a decrease of 0.3%. A falling inflation rate is normally considered negative for the domestic currency because it could lead to lower interest rates in the future.

The franc’s price action as mixed as the colors of Happy Pip’s sneakers as it lost against the euro but gained against the Greenback. USD/CHF ended last Friday with a 15-pip loss while EUR/CHF shot up by 59 pips.

We won’t be seeing any action from Switzerland until Wednesday when the retail sales data is released, but that doesn’t mean that you shouldn’t watch the franc pairs! Keep an eye out for any report that could influence risk sentiment and the price action of the low-yielding franc. I hear that a lot of major reports are due from the U.S. this week!

While other currencies were able to beat the living daylights out of the safe haven U.S. dollar, the Swiss franc found itself actually selling-off in yesterday’s trading session. USD/CHF was at .9219 by the end of the U.S. trading session, a good 91 pips higher from its open. The Swiss franc also suffered versus the euro as EUR/CHF was bought up to 1.2333 from 1.2191.

It seems that the easing of tensions in the euro zone has reduced the “safe haven demand” for the Swiss franc. There were also rumors that suggested that a certain Swiss bank was considering setting negative interest rates on their CHF-denominated deposits.

Switzerland’s economic cupboard today is completely bare, but I think we’ll still see a lot of movement from the Swissy as late sellers try to get in on the currency’s bearish movements. Let’s see if we’ll see a continuation of yesterday’s price action today.

The franc was the biggest loser in the forex markets yesterday as sentiment for the higher-yielding currencies improved somewhat. The low-yielding franc continued to nurse losses against the dollar, euro, and the pound with USD/CHF shooting up by as much as 101 pips. Yowza!

We didn’t see any economic data from Switzerland yesterday, but the prospect of paying for franc deposits as well as the overall improvement in appetite for higher yielding currencies brought the franc to notable weaknesses against its major counterparts.

Switzerland’s economic board looks blank again today, so I’m not expecting any game changer for the franc pairs. If you’re trading the franc though, make sure that you’ve also noted the potential inflection points as well as the possible news events that might inspire profit-taking for the franc bears!

“Whew, I gotta catch my breath!” said USD/CHF yesterday as it stayed in consolidation after a few days of consecutive rallies. The pair moved sideways above the .9300 handle as it reached a high of .9330 then closed at .9320. Which way will it break out today?

Even though Switzerland’s retail sales figure missed expectations for November, the Swissy managed to hold its ground against the Greenback. On an annualized basis, retail sales rose by only 2.9% during the month instead of the projected 3.3% increase. Still, the actual figure was higher than the previous month’s 2.7% reading, reflecting a slight improvement in consumer spending.

Switzerland is set to report its PPI at 9:15 am GMT today. The figure is expected to show a 0.2% uptick in producer prices for December after staying flat in November. If the actual release beats or meets expectations, USD/CHF might have a chance at breaking below consolidation. Otherwise, stay on your toes for a potential continuation of this pair’s strong rally!

The franc bulls lost more muscles in the charts yesterday as it continued to weaken against its counterparts. Its weakness was more pronounced in EUR/CHF, which shot up by as much as 103 pips. Talk about being a big loser!

Switzerland’s weaker-than-expected PPI reading might have factored into the mix. Yesterday the report showed a 0.1% growth for the month of December, which is lower than the expected 0.2% uptick.

No other report is set to be released from Switzerland for the rest of the week, so keep your eyes peeled for risk appetite/aversion plays in the low-yielding franc pairs. I hear that China’s economic reports released a few minutes ago all came in better-than-expected, which would most likely boost appetite for the high-yielding currencies. Will we see more franc weakness? Stay at the edge of your seats!