GBP/CHF Exchange Rate Flat as Weak UK Services PMI Holds Back Sterling
The Pound Swiss Franc (GBP/CHF) exchange rate steadied today, fluctuating around 1.2398CHf on the interbank market.
The Swiss Franc (CHF) stabilised against the Pound (GBP) following the release of the Swiss Consumer Price (CPI) figures for June.
These approved above the consensus 0.5% to 0.6%, holding steady against last year’s figures.
Switzerland’s Federal Statistical Office, said in its press release:
‘The stability of the index compared with the previous month is the result of opposing trends that counterbalanced each other overall. Heating oil and prices for stone fruit decreased. In contrast, prices for international package holidays and fruiting vegetables increased.’
The Pound, meanwhile, has remained rangebound against the Swiss Franc today following yesterday’s Markit Services PMI figures for June.
Narrowly avoiding contraction and falling below consensus, these fell from 51.0 to 50.2.
As a result, this has left many Sterling traders feeling jittery as the UK economy continues to show sights of slowing down.
GBP/CHF Exchange Rate Rangebound as Brexit Uncertainties Weigh on UK Markets
There are no economic data releases due for the UK today.
Instead Pound traders are focusing on political developments regarding the Tory leadership race and Brexit.
Keir Starmer, the Shadow Brexit Secretary, has warned leadership favourite Boris Johnson that MPs would ‘do everything to stand in his way’ should he decided to push ahead with a ‘bad deal or a no-deal Brexit’.
Prime Minister Theresa May, in her last speech in Scotland as leader, is also set to warn her successor of the damagers – economically and for the state of the union – of a no-deal Brexit.
Meanwhile, Mr Johnson has heightened UK political fears, saying that the Conservative Party are ‘staring down the barrel of political extinction’ over their handling of Brexit.
Today also saw Brexit Secretary Stephen Barclay say that a no-deal Brexit scenario could not be ruled out.
As uncertainty continues to rise over the UK’s future within the European Union the Sterling is unable to make any notable gains as a result.
GBP/CHF Forecast: Swiss Fran Safe-Haven Could Benefit from Reignited Trade Tensions
Sterling traders will be awaiting tomorrow’s printing of the UK Halifax house prices figures for June.
Any signs of easing could further spark concerns over the economy’s growth in the near-term.
Swiss Franc investors, meanwhile, will be paying close attention to global economic developments.
With the currency being a safe-haven, any further indications of reigniting trade tensions between the US and China could provide some uplift for the risk-correlated CHF/GBP exchange rate.