Swiss Franc to South African Rand Exchange Rate Forecast to Rally after Swiss Unemployment Unexpectedly Fell
CHF/ZAR Exchange Rate Forecast to Advance after Swiss Consumer Prices Bettered Expectations
If you're looking to make an international money transfer, we recommend TorFX.
The Swiss Franc to South African Rand (CHF/ZAR) exchange rate strengthened considerably on Tuesday afternoon thanks to a combination of positive Swiss ecostats and negative South African data.
Results from Swiss data publications today came as somewhat of a surprise as both labour market data and consumer price reports bettered the respective market consensuses. February’s Unemployment Rate was predicted to hold firm at 3.8%, but the actual result showed unemployment dropped to 3.7%. This is despite long-term concerns that the overvalued Franc has caused many domestic companies to outsource work.
Swiss consumer price data also surprised to the upside. February’s Consumer Price Index was predicted to hit -1.1% on the year, but inflation actually hit -0.8%. On a monthly basis, February’s Consumer Price Index came in at 0.2% which was significantly better than the -0.1% forecast.
‘This pick-up in inflation is mostly due to a 2% m/m surge in clothing & footwear prices, which coincides with the end of the winter sales. Besides this upside surprise, the other subgroups showed no sign of significant improvement and the inflation outlook remains weak. We therefore believe that the subsequent rise of the Swiss Franc against the single currency this morning is absolutely not justified given the temporary nature of this higher CPI read,’ stated forex analyst Arnaud Masset.
The Swiss Franc to South African Rand (CHF/ZAR) exchange rate is currently trending in the region of 15.4379.
ZAR/CHF Exchange Rate Forecast to Dive after South Africa’s Current Account Deficit Widened
The South African Rand declined versus its major peers on Tuesday after domestic data failed to impress. South Africa’s fourth-quarter Current Account data showed the deficit widened beyond expectations to -208 billion Rand.
‘Even though the depreciation in the exchange value of the Rand boosted the export earnings of domestic producers, the benefits thereof were more than fully negated by a further decline in the international prices of South African export commodities in the fourth quarter,’ the Reserve Bank said.
A massive drop in emerging-market stocks, after China’s exports contracted beyond expectations, is also having a detrimental impact on demand for the South African asset.
Inflationary concerns have also reduced the appeal of the Rand with the current rate exceeding the central bank’s target. ‘Inflation pressures intensified in recent months and it’s already outside the target range,’ Johan van den Heever, head of economic reviews and statistics in the central bank’s research department, said on Tuesday. ‘It seems there’s more bad news in the pipeline.’
The Swiss Franc to South African Rand (CHF/ZAR) exchange rate dropped to a low of 15.3130 during Tuesday’s European session.
Swiss Franc to South African Rand Exchange Rate Forecast: ECB Rate Decision in Focus
Thursday’s European Central Bank (ECB) interest rate decision is likely to have a significant impact on the CHF/ZAR exchange rate. Should ECB policymakers ease policy more than has been priced-in by traders, the resultant Euro depreciation is likely to fuel CHF gains. Moreover, the South African Rand may track Euro losses as the corresponding US Dollar appreciation will limit the appeal of emerging-market assets.
The Swiss Franc to South African Rand (CHF/ZAR) exchange rate climbed to a high of 15.6007.