Pound Sterling to Swiss Franc (GBP/CHF) Moves from 3-Month Low, USD/CHF Steady
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With a YouGov poll showing that the yes voters now outrank the no voters it looks as though next week’s Scottish referendum could be incredibly tight.
If Scotland does opt to leave the UK the Pound could depreciate by as much as 5% so the 51%-49% vote split in favour of independence pushed Sterling considerably lower against the majority of its currency counterparts.
As well as sliding by almost 1.0% against the Swiss Franc (achieving a low of 1.5002) the Pound shed over 1.0% against both the US Dollar and Euro.
The Pound Sterling to Swiss Franc (GBP/CHF) hit a high of 1.5119
Fluctuations in the GBP/CHF exchange rate were also caused by economic data from Switzerland.
The nation’s employment data showed that the jobless rate climbed from 2.9% in July to 3.0% in August, slightly better than the increase to 3.1% anticipated.
A separate report showed that the rate of inflation in Switzerland was unchanged in August, month-on-month, after slowing by -0.4% in July. An increase of 0.1% had been anticipated.
On the year inflation came in at 0.1%.
Finally, domestic retail sales unexpectedly declined in July, plummeting by -3.4% on the month and tumbling by -0.6 on the year.
The Swiss Franc remained trending lower against the US Dollar after the reports were released.
According to Boby Michael of IBT; ‘The Swiss Franc showed some strength in the morning as Swiss consumer price inflation accelerated more than expected in August, but overall Dollar strength held it near the one-year low touched after last week’s ECB rate cut. […] USD/CHF slipped to 0.9306 after the data from 0.9313 at Friday’s close but rebounded to 0.9330 later as the ‘Greenback’ continued to rally across the board.’
Pound Sterling to Swiss Franc Exchange Rate Forecast
There are no further economic reports for Switzerland scheduled for publication this week, with the next piece of domestic news (the nation’s Producer Price Index) not being released until the 15th.
Next week is a little more data heavy in that Switzerland’s Balance of Trade figures are out and the Swiss National Bank will be delivering its interest rate decision.
Over the next few days it will be UK news dictating the direction taken by the Pound Sterling to Swiss Franc exchange rate.
If the UK’s fundamentals impress, the GBP/CHF exchange rate could recover losses. However, any disappointing results may drive the Pound lower against the Swiss Franc.
The US advance retail sales data could trigger USD/CHF volatility later in the week.
The Pound Sterling to Swiss Franc exchange rate is currently trending in the region of 1.5059.
After falling to trend around a three-month low against the Swiss Franc on Monday, the Pound recovered on Tuesday thanks to a better-than-forecast British Retail Consortium like-for-like sales report and an unexpectedly strong increase in UK Industrial Production.
The Pound to Swiss Franc exchange rate fluctuated between lows of 1.5043 to highs of 1.5110. With Swiss economic reports limited for the rest of the week, UK news (and in particular Scottish referendum developments) are likely to be the main causes of GBP/CHF movement.