The Swiss Franc has retreated away from a four month high against the US Dollar and extended its losses as traders take profits on bets against the US currency.
The Franc followed the Euros movement downwards after the single currency came under pressure against the ‘Greenback’ after European Central Bank President Mario Draghi said that the Bank’s bond buying programme was necessary and in line with its mandate.
Some traders believe that speculators could now be unwinding their short Dollar positions and rebuilding their long holdings.
“We expect the Dollar to get stronger in the next few months, and also the Swiss Franc, as weakening economies drive investors towards safe haven currencies,” said Sarasin economist Alessandro Bee.
Bee also said he sees the Dollar firming against the Swiss Franc as the improving economic conditions in the United States contrast with those in the struggling Euro zone, Switzerland’s biggest trading partner, creating a drag on the Swiss currency.
Ongoing civil unrest in Greece and the release of data showing that employment across the Eurozone fell to a seven year low have reminded the markets that the Euro crisis is far from over despite them trying to talk up the flagging region. Eurostat data showed that the unemployment rate reached a new high in April, with 19.4 million people now out of work.
The data has increased investor demand for safer assets boosting the appeal of the Swiss Franc over that of its struggling neighbours.
Current Swiss Franc (CHF) Exchange Rates
Swiss Franc/ Euro Exchange Rate is currently in the region of: 0.8119
Swiss Franc/US Dollar Exchange Rate is currently in the region of: 1.0825
Swiss Franc/ Pound Sterling Exchange Rate is currently in the region of: 0.6915
Swiss Franc/ Australian Dollar Exchange Rate is currently in the region of: 1.1277
(Correct as of 12:10 pm GMT)
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