- The Swiss franc rises strongly against the dollar and the euro.
- Expectations for a less dovish ECB support the Swiss franc.
- USD/CHF falls for the fifth day in a row on Wednesday.
The USD/CHF it falls almost a hundred points on Wednesday after paring some losses in the last hour. The pair bottomed at 0.9084, the lowest level since November 2021, and then bounced past 0.9100 again.
Falling US and European government bond yields weakened the dollar and favored the Swiss franc. The Swiss 10-year bond yield fell to 1.05%, the lowest level since early December, and the US 10-year bond yield fell to 3.38%, the lowest level since September.
Demand for European bonds strengthened after data showed slowing inflation and some “not so bad” activity numbers; and in particular following a media report on Tuesday that mentioned that European Central Bank policymakers are starting to consider a slower pace of interest rate hikes after the February meeting.
Expectations of a less aggressive ECB sent the euro down, which remains a drag. The EUR/CHF pair has suffered a sharp decline, reversing sharply from 6-month highs near 1.0100 to levels below 0.9900.
Economic data released on Wednesday weighed further on USD/CHF. Inflation figures were below expectations, while Retail Sales and Industrial Production fell more than expected.
USD/CHF breaks 0.9200
USD/CHF is consolidating below 0.9200, reinforcing the downtrend. On the other hand, the next critical support is the 0.9100 area. A daily close below would open the door for more losses. A recovery above 0.9220 would ease the negative tone.
technical levels
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
