Swiss Franc rate is back to gradual movement at the Forex currency market after sharp rise on Monday Franc is strengthening imperceptibly.

 

Forex forecast: MACD indicator for the pair USD/CHF is in the positive area, it goes down and is shaping a sell signal. Stochastic Oscillator goes down in the neutral zone, moving and is giving a sell signal.

 

Forex recommendations: in case of breakdown at the level of 0.9060, the pair USD/CHF will go to 0.9040 and 0.9020. If downward breakdown does not take place, the pair will remain close to the current levels.

 

There are no fundamental changes in Swiss economy; position of Swiss National Banks is strong enough to keep currency in the permissible limits.

At the beginning of this week the pair USD/CHF slid down following the pair EUR/CHF, which had been actively sold by one of the Swiss Banks and British Clearing Bank, explained dealers.

 

As per the SNB annual report, in the next 6 month economy of the country will come to a standstill due to the impact of the expensive Franc and sharp decline in foreign demand. Thus, GDP in Switzerland will amount to 1.5%-2.0% this year and main growth will attribute to the results of the first part of the year. SNB noted in the comments that if stringent monetary measures had not been taken the economy would have slipped to a recession. SNB expects that inflation will be at the level of 0.4% in 2011 and at the level of 0.3% next year. It became known earlier that unemployment rate in Switzerland remained at the level of 2.8% in September as expected. Employment sector is stable so far; however repercussion of the expensive national currency is possible. Index of PMI SVME fell to 48.2 points in September against the level of 51.7 points in August. In addition retail sales in Switzerland fell by 1.9% y/y in August against +1.9% y/y a month earlier.

 

It is worth noting that SNB gave indications in September that could have been interpreted as follows: regulator’s power to maintain the Franc is fading away. We would remind that according to the rumors that grew louder among investors in the market SNB can review its position on the key levels and peg exchange rate of the pair EUR/CHF to around 1.25. According to Mr Jordan, a representative of the SNB, it is necessary to increase the reserves of the SNB in order to prevent the growth of the Franc. SNB will take all measures to protect the target level of SNB. According to him, if you just sit back, CHF will rise above the parity level in pairing with the Euro. At the same time the monetary politician did not comment on the probability of increasing the target level.