CHF: Swiss Franc goes up, as regulator refrains from action

At the Forex currency market Swiss Franc rate regains losses –investors had been annoyed with the position of the Swiss National Bank, so while the SNB maintains position of noninterference, they begun to buy Franc.

Forex forecast: MACD indicator is in the negative area for the pair USD/CHF, and is going up, ready to break through the signal line from bottom to top and is shaping a buy signal, while volume are low. Stochastic Oscillator is prepared to leave overbought zone and tends to shape a sell signal.

Forex recommendations: in case of breakdown at the level of 0.8010, the pair USD/CHF will go to 0.7990 and 0.7970.

If downward breakdown does not take place, the pair will consolidate at the current levels.Demand for Franc went up when government announced a new market aid program, although the amount was lower than expected: CHF870 million. In addition, authorities indicated that they are not going to set a target rate for the Franc.

According to the Minister of Economic Affairs of Switzerland, the country will have to put up with expensive Franc for some time and only SNB is able to influence on the Franc in medium-term. It became known earlier that producer prices and imports prices in Switzerland declined by 0.7% m/m (-0.5% y/y) in July against the fall of 0.6% m/m in June.

In addition, consumer confidence index in Switzerland fell to -17 points in Q3 against the forecast of -5 points. According to the data released earlier, unemployment rate in Switzerland remained at the level of 3.0% in July. Statistics released earlier showed that the level of retail sales in Switzerland increased by 7.4% in June against the revised level of -3.9% in May.

In addition, index of PMI SVME rose to 53.5 points in July against the forecast of 52.5 points.Statistics released earlier showed that consumption indicator UBS fell to 1.29 points in July against the level of 1.52 points in June. The indicator has been sliding down not for the first month, showing negative tendencies in the economy.

GDP in Switzerland in Q2 will be known on Thursday, as well as the data on PMI in August and retail sales in July. The rise in volatility in the pair is possible on this day due to the great bulk of statistics.

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