The Pound Sterling to Swiss Franc (GBP/CHF) exchange rate ticked higher by around 0.29% on Monday afternoon.
Although British economic data printed relatively disappointingly on Monday, the Pound strengthened versus most of its major peers. The appreciation can be attributed to heightened demand after a spate of profit-locking took the Pound lower.
The Swiss Franc, meanwhile, softened versus many of its major peers after retail sales declined significantly. The depreciation was somewhat slowed, however, thanks to speculation that the Swiss National bank (SNB) would refrain from further intervention despite the still high-valued ‘Swissie’ (CHF).
The Pound Sterling to Swiss Franc (GBP/CHF) exchange rate is currently trending in the region of 1.4445.
Pound Sterling (GBP) Exchange Rate Forecast to Strengthen Versus the Euro despite Cooling House Prices
After the Pound’s election-based rally was stretched by a succession of positive data publications, the Pound softened over the weekend as traders found attractive selling positions following the significant appreciation. The spate of profit-locking saw the Pound decline beyond its justified level, although this was quickly resolved amid heightened demand.
British economic data failed to impress on Monday which slowed Sterling gains. May’s Rightmove House Prices increased by 2.5% on the year, with the monthly score declining by -0.1%. ‘This is an election-driven price stall which gives some buyers only short-term relief from the back-drop of a long-term housing shortage,’ said Miles Shipside, Rightmove’s housing market analyst. ‘Many estate agents are now reporting a resurgence in interest following the surprise election result.’
The Pound Sterling to Swiss Franc (GBP/CHF) exchange rate dropped to a low of 1.4367 today.
Swiss Franc (CHF) Exchange Rate Forecast to Soften Versus the US Dollar on Rocky Economic Data
Swiss economic data printed poorly on Monday which initiated ‘Swissie’ depreciation. On the year, March’s Retail Sales softened by -2.8%. This has added to signs of deflation after the SNB abandoned its cap with the Euro. Slow readjustments in companies’ budgets, worries about lower salaries and lower returns on pension and savings accounts are the reasons cited for the decline in retail sales.
However, SNB’s Fritz Zurbruegg said he doesn’t believe that Switzerland will fall into sustained deflation. ‘Currently we see no signs of a deflationary development as was experienced in the 1930s, that means negative price development across all goods and with a self-reinforcing downwards spiral,’ he said in an interview with the Berner Zeitung published on Monday.
This has not alleviated fears that the SNB will be forced to intervene again in order to devalue the currency, although many feel that the easing cycle has ended now that they have fallen into negative inflation. ‘The Franc remains highly valued,’ Zurbruegg also said, echoing a statement SNB rate-setters have made repeatedly in recent months. ‘We still assume that a weakening of the Swiss Franc against the Euro should take place.’
Pound Sterling to Swiss Franc (GBP/CHF) Exchange Rate Forecast to Hold Gains on Lack of Data
With an absence of further data publications to provoke changes, the Pound Sterling to Swiss Franc (GBP/CHF) exchange rate is likely to hold gains for the remainder of Monday’s European session. Tuesday ought to see significant GBP/CHF volatility with British inflation and retail sales data due for publication.
The Pound Sterling to Swiss Franc (GBP/CHF) exchange rate climbed to a high of 1.4465 today.
Comments are closed.