CHF: Swiss Franc reluctantly moves away from historic highs

At the Forex currency market Swiss Franc rate moves away slightly from its previous highs on Monday; however volume of sales is not high, taking into account continuing global instability, particularly in the matter of Libya. 

Forex forecast: MACD indicator is in the negative area for the pair USD/CHF and goes down slowly, maintaining a pair sell signal. Stochastic Oscillator tends to come out of the oversold zone and to confirm a pair buy signal.

Forex recommendations: in case of breakdown at the level of 0.9060 the pair will go to 0.9090 and 0.9120. However it should be kept in mind that if external background deteriorates, aggressive traders will come back.

Data on the trade balance in Switzerland for February will become known on Tuesday, in general,  macro-economic background will remain quiet for the country this week.

Statistics demonstrated earlier that level of CPI in Switzerland increased by 0.4% m/m (+0.5% y/y) in February against the forecast of growth by 0.3% m/m. Thus, inflation in Switzerland has been increasing slightly so far, which on one hand, indicates economic recovery in the country and on the other hand does not give rise to discussions of the interest rate revision.

In addition, unemployment rate in Switzerland reduced to 3.6% m/m in February against the previous rate of 3.8% m/m. In general it is a positive indicator for Swiss economy, which indicates that economic system of the country is being recovering steadily, despite high rate of the national currency.

Swiss National Bank adopted measures of verbal intervention against the Franc last week: representatives of the SNB said following the meeting that strong currency is a hard burden for the economy and its inflated price will trigger a slowdown of  economic growth – largely, due to the decrease of the export volumes.

The level of three-month LIBOR rate was left unchanged, at the 0.25%, as expected.

[More]