Wednesday, 30 Dec 2009

Rate of Swiss Economic Growth May Negatively Impact Franc

A slow day in early morning trading was punctuated by the release of the monthly KOF Economic Barometer report. The report, a Swiss indicator, predicts how the Swiss economy is likely to function in the next six months. The figure released indicated that while there still has been growth in the Swiss economy in December, the rate of growth has been markedly slower then in previous months. This has led experts to the conclusion that Switzerland's economic recovery will likely loose momentum in 2010.

The market reacted to this news in a mixed way. After initially making some gains on the British Pound before the release of the report, the Swiss Franc has since corrected itself and is currently trading at around 1.6470. The Yen, already struggling against most of its major counterparts, took losses against the Swiss currency following the release of the report, and is currently trading at 88.90. Franc traders may want to note that while the Swiss economy is still growing, it looks like the slow rate of growth could negatively impact the currency.