JPY Daily News

Negative Interest Rate Rumor Fuels CHF Weakness

The EUR/CHF was on a rollercoaster ride yesterday as the CHF weakened versus both the USD and the EUR. The trigger for the CHF moves were rumors of the Swiss government debating a negative interest rate to help weaken the currency. Recent economic data in Switzerland has been on the weak side with GDP coming in at only 0.2% in Q3 and the KOF economic barometer falling to 0.35 from 0.75. Market expectations are for additional moves by the SNB to weaken the franc as the threat of deflation continues to weigh on the Swiss economy. This could take the form of raising the floor of the EUR/CHF to 1.25 from 1.20. The EUR/CHF has resistance at October 19th high of 1.2470 with support at its 200-day moving average at 1.2225.

Current Time: 05/26 22:38 GMT

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