CHF: Swiss Franc tends to retest historical highs

At the Forex currency market Swiss Franc rate continues to grow on Thursday – the pair USD/CHF tested the latest highs once again yesterday and it is possible that today the pair will reach it again.

Forex forecast: MACD indicator is in the negative area for the pair USD/CHF and reverses downward, giving a pair sell signal. Stochastic Oscillator remains in the oversold zone today, giving a similar signal.

Forex recommendations: in case of breakdown at the level of 0.8950 the pair will go to 0.8924, to the previous lows, and further to 0.8900.

It became known yesterday that Swiss producer price index and prices for import increased by 0.4% y/y in March which agreed with the forecasts.
Today investors will await the release of the index of investors’ economic expectations ZEW for April.

Three- month Libor rate remains unchanged, at the level of 0.25%.
Earlier Swiss National Bank has been taking active measures of verbal intervention against the Franc: following the last meeting representatives of the SNB said that strong currency is a burden for the economy and its overprice will trigger slowdown of the economy – largely due to the deceleration in exports volumes. A couple of weeks ago Swiss National Bank began to give indications of the possible intervention: the representative of the regulator Mr. Dantin stressed that the Bank is capable to ensure price stability even amid excess liquidity. In addition the politician said that the cost of intervention in the currency market will be determined by the informational pressure.

In general the situation in Swiss economy has not changed this morning. It became known earlier that actual level of retail sales in Switzerland increased by 1.5% m/m in February against the fall by 2.4% m/m in January. However index of SVME-PMI fell to 59.3 points in March against the previous value of 63.5. According to the data released yesterday level of CPI in Switzerland rose by 0.6% m/m (+1,0% y/y) in March against the forecast of growth by 0.2% m/m. It is a ambiguous factor for Swiss economy as on the one hand the economy strengthens and on the other hand it suffers from significant inflationary pressure.

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