Swiss franc news - page 20
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Switzerland unemployment rate Nov SA 3.3% as exp
Switzerland Nov unemployment rate 9 Dec
CHF: SNB To Say Hold On Thursday, To Stress FX Intervention Policy
This Thursday, we expect the SNB Governing Board to maintain its strategy following its regular quarterly monetary policy meeting. Therefore, we forecast the target range for the three month libor will remain between -1.25% and -0.25% and the interest rate on sight deposits at -0.75%.
Once again the bank will stress that the Swiss franc is still highly overvalued and that currency interventions will remain in its tool box, if required.
Most recently, SNB board members have stressed the need to maintain an extremely expansionary monetary policy stance. In their view, only negative interest rates combined with the central bank’s willingness to intervene in the foreign exchange market are sufficient to ease upward pressures on the Swiss franc. On the other hand, given continuing expansion in the Swiss economy and the slow upward trend in inflation rates there is no need to ease monetary policy further,
OUTLOOK. Given its present views on prospects for the economy and inflation, the SNB will maintain its present easing bias. It will continue to focus on keeping monetary conditions unchanged.
Presently, we see no chance the negative deposit rate will be abandoned in the foreseeable future. Indeed, we expect the SNB to leave its monetary policy stance unaltered at least until mid-2018.
source
USD/CHF: Little Changed Following Monday’s Setback
USD/CHF is little changed relative to Monday’s North American close in today’s trading, currently holding near the 1.1026 level.
The pair met resistance both last Friday and during yesterday’s session at the November highs. Given the sluggish upside momentum suggested by the Stochastic, it appears USD/CHF could be subject to further weakness or at least a period of consolidation in today’s session.
On the downside, first support is at the 1.01200-1.01153 zone, followed by December 8’s spike low at 1.00213. Holding this level would result in no significant technical damage and keep the pair in position to make another run up to the November peak near 1.0200.
On a move above this resistance area, the next target becomes the late January corrective top at 1.02564, followed by the November 2015 corrective top at 1.0330. This represents a key level, as a break above would shift the longer-term trend in USD/CHF in favor of the bulls.
Key economic events this week in the US and Switzerland include policy decisions from the Federal Reserve on Wednesday and the Swiss National Bank on Thursday.
In the US, a quarter point rate hike is expected and fully priced into the market. The focus will be on forward guidance from Federal Reserve Chair Janet Yellen. The dollar could be subject to a selloff if Yellen indicates the next rate increase will be delayed by several months. The overall tone of the statement will also be very important with a focus on commentary surrounding inflation and inflation expectations.
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Switzerland December Credit Suisse ZEW survey expectations 12.9 vs 8.9 prev
Swiss December Credit Suisse ZEW survey 14 Dec
A decent number given the long term average is around 10
Expectations are for the next 6 months and now have risen four times in a row.
SNB Interest Rate Decision: Swiss National Bank Keeps Interest Rates At -0.75%, Intervention Will Continue
Following its latest quarterly policy meeting, the Swiss National Bank (SNB) made no changes in interest rates with the target rate for 3-month Libor rate unchanged at -0.75%.
The SNB reiterated that it would remain active in the foreign exchange market as necessary, while taking the overall currency situation into consideration with the franc still considered to be significantly overvalued.
The SNB’s policy is aimed at stabilising price developments and supporting economic activity.
According to the SNB, October and November inflation readings were slightly lower than expected and the new conditional inflation forecasts were lowered slightly in response.
The 2017 forecast has been cut to 0.1% from 0.2% with the 2018 estimate reduced slightly to 0.5% from 0.6%. The forecasts assume that interest rates remain at -0.75% throughout the forecast period.
The SNB expects that the moderate pace of global growth to continue in 2017, although the baseline scenario is subject to considerable risks, especially with uncertainty surrounding the Trump Administration. The bank also pointed to uncertainties surrounding the German and French national elections due next year.
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USD/CHF Finds Support During Consolidation
USD/CHF is consolidating following the recent sharp gains, currently trading at 1.0284, down 0.13% from Thursday’s North American close.
Support has been found at the former rally high established in late January. The ability to hold this level as support is a bullish sign that keeps the bias in the pair firmly to the upside.
The next upside target is the November 2015 corrective top at 1.0330. This represents a key level of resistance, as a break above would shift the longer-term trend in USD/CHF in favor of the bulls.
On the downside, first support is at the late January top at 1.02564, followed by the former highs established in November and December near the 1.0200 level. Holding this level on a pullback would keep the broader bias for USD/CHF firmly to the upside. At present, a pullback to this level of support does not appear likely to unfold.
In this week’s trading, aside from the Federal Reserve raising rates 25 basis points, the Swiss National Bank (SNB) made no changes in interest rates with the target rate for 3-month Libor rate unchanged at -0.75%. The SNB reiterated that it would remain active in the foreign exchange market as necessary, while taking the overall currency situation into consideration with the franc still considered to be significantly overvalued.
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USD/CHF Approaching Recent Rally High
USD/CHF is displaying strength in today’s trading, currently holding near the highs of the session at 1.0297, up 0.22% over Monday’s North American close.
Resistance is at the latest rally high at 1.03437, which represents a test of the November 2015 corrective top at 1.0330. This represents a key level of resistance, as a sustained break above would shift the longer-term trend in USD/CHF in favor of the bulls. On such a move, the target becomes the June 2010 high at 1.17320.
On the downside, first support is at Monday’s reaction low at 1.02170, which represents a test of the former highs established in November and December near the 1.0200 level. Holding this level on a pullback would keep the broader bias for USD/CHF firmly to the upside. At present, given the resilience exhibited by the pair in the presence of an extreme overbought condition, a pullback to this level of support does not appear likely to unfold.
In the US, there are no key economic releases on the calendar today. Existing home sales is due out Wednesday at 10:00am ET. On Thursday, Q3 GDP, jobless claims, durable orders, leading indicators, personal income/spending and the core PCE price index are on the calendar. The University of Michigan Consumer Sentiment Index and new home sales will be released on Friday.
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Switzerland Q3 current account surplus CHF 21bln vs 23bln yy
Latest data out from the SNB 21 Dec
Says the SNB:
Receipts
Receipts from total goods trade amounted to CHF 78 billion, CHF 6 billion higher than in the year-back quarter. Goods exports according to foreign trade statistics (total 1) increased by CHF 3 billion year-on-year to CHF 53 billion in the third quarter. Exports were up in the chemical and pharmaceutical industry, and in jewellery, in particular, while they receded in the watch industry. Receipts from non-monetary gold trading came to CHF 21 billion, compared to CHF 17 billion in the year-back quarter.
At CHF 6 billion, net merchanting receipts remained on a par with the year-back figure. Receipts from trade in services with foreign countries in the third quarter amounted to CHF 28 billion, up CHF 1 billion over the year-back figure. An increase was registered in insurance and pension services, telecommunications, computer and information services, business services, and licence fees, whereas receipts from transport declined. As a result of lower receipts from investment abroad (particularly direct investment), primary income (labour and investment income) decreased by CHF 4 billion to CHF 32 billion.
Secondary income (current transfers) advanced by CHF 1 billion to CHF 10 billion compared with the third quarter of 2015.
Expenses
Expenses for total goods trade amounted to CHF 62 billion, a CHF 4 billion increase over the year-back quarter. Goods imports according to foreign trade statistics (total 1) increased by CHF 2 billion to CHF 42 billion compared to the year-back level. The largest rise was recorded in chemical and pharmaceutical products, and in motor vehicles.
Expenses from non-monetary gold trading came to CHF 18 billion, compared to CHF 17 billion in the third quarter of 2015. At CHF 23 billion, expenses in services imports exceeded the figure for the year-back quarter by CHF 1 billion. This was primarily attributable to higher expenses for telecommunications, computer and information services as well as business services. The other components did not change significantly from their third quarter 2015 levels.
Expenses in the case of primary income (labour and investment income) remained unchanged at CHF 31 billion. With regard to secondary income (current transfers), expenses totalled CHF 12 billion, equalling the amount in the year-back quarter.
USD/CHF: Consolidation Remains Underway
USD/CHF is modestly lower in today’s session, trading near the 1.0246 level, down 0.21% from Wednesday’s North American close.
As is the case in USD/JPY, USD/CHF appears to be in the process of forming a flag-like formation following last week’s move to new rally highs. This formation suggests an upside breakout is likely.
Initial resistance on a move to the upside is at Tuesday’s 1.03203 high followed by the December peak at 1.03437. This high represents a test of the November 2015 corrective top at 1.0330, a key level of resistance as a sustained break above would shift the longer-term trend in USD/CHF in favor of the bulls. On such a move, the target becomes the June 2010 high at 1.17320, as can be seen on the monthly chart.
Should the current consolidation phase give way to further selling, the next level of support stands at Monday’s reaction low at 1.02170, which represents a test of the former highs established in November and December, near 1.0200. Holding this level on a pullback would result in no technical damage to the pair. And, given the resilience exhibited by USD/CHF in the presence of an extreme overbought condition, a drop below this level of support does not appear likely to unfold.
In the US today, Q3 GDP, jobless claims, durable orders, leading indicators, personal income/spending and the core PCE price index are on the calendar. The University of Michigan Consumer Sentiment Index and new home sales will be released on Friday.
In Switzerland, KOF Leading Indicators for December is due out Friday. A reading of 103.1 is expected, following a reading of 102.2 in November.
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Switzerland KOF leading indicator Dec 102.2 vs 103.00 exp
Swiss December KOF leading indicator report 23 Dec
- 102.2 prev
The KOF Leading Indicators Index is designed to predict the direction of the economy over the following six months. The index is a composite reading of 12 economic indicators related to banking confidence, production, new orders, consumer confidence and housing.