The Pound Sterling to Swiss Franc (GBP/CHF) exchange rate advanced by more than 0.3% during the European session following the publication of Switzerland’s Producer and Import Price figures.
The report showed an unexpected -0.2% month-on-month decline in August following no change in July. Economists had expected stagnation last month.
On a year-on-year basis, Producer and Import Prices fell by -1.2%, a steeper decline than the -1.0% dip anticipated and down from the -0.8 figure recorded in July.
This marked the 11th month of falling prices.
According to the report; ‘Prices were lower in particular for petrol and petroleum products as well as for pharmaceutical products which are surveyed on a quarterly basis.’
The disappointing data saw the Franc soften against the majority of its currency counterparts.
The Swiss Franc fell to a five-day low against a fairly static Euro and moved away from a short-lived six-day high against the US Dollar.
The Pound Sterling to Swiss Franc (GBP/CHF) hit a high of 1.5229
Sterling also exhibited strength against the Franc thanks to signs that unionists might triumph when the Scottish referendum is held later this week.
Of four surveys conducted over the weekend, only one put nationalists in the lead.
The Queen also commented on the situation for the first time, intimating that the Scottish people need to think very ‘carefully about the future’ before they make their decision.
Further Pound strength was derived from the UK’s Rightmove House Price report.
The data detailed a bit of a rebound in September, with house prices advancing by 0.9% on the month following the deceleration recorded in August.
However, Rightmove also waded into the debate on Scottish independence, implying that house prices would tumble if Scotland should opt to leave the UK.
In the words of Rightmove analyst Miles Shipside; ‘Even the very debate about Scottish independence and possible implications for the economic outlook for the rest of the UK could cause uncertainty in the minds of potential home-movers contemplating a long-term financial commitment. Speculation amongst economic forecasters on topics such as upward pressure on interest rates, availability of wholesale funding for lenders, and the geographic location of major financial institutions are potentially destabilising influences on consumer sentiment.’
The Pound was trading in a stronger position against the US Dollar, Australian Dollar and Swiss Franc as the European session progressed on Monday.
The British asset was slightly softer against the Euro.
Pound Sterling to Swiss Franc Exchange Rate Forecast
The GBP/CHF exchange rate is likely to continue trending in its current range in the hours ahead.
Swiss data to be aware of over the next few days includes the nation’s Trade Balance, Import and Export figures (due out on Thursday) and the Swiss National Bank’s interest rate decision, also taking place on Thursday.
Any additional volatility in the Pound Sterling to Swiss Franc exchange rate is likely to be the result of UK news.
Investors will be paying particular interest to the UK’s inflation report, the Bank of England’s meeting minutes, UK employment stats and the result of the Scottish referendum.
The Pound Sterling to Swiss Franc exchange rate is currently trending in the region of 1.5213.
