- USD/CHF price maintained bullish trends today.
- Swiss statistics agency indicated that the economy grew by only 2.8% in the second quarter.
- Also, the pair hiked after Russia halted Europe gas deliveries.
The USD-CHF exchange rate hiked to its highest market since 15 July as the United States dollar strengthened and weak Swiss GDP numbers. The pair soared to the 0.9861 high, which was nearly 4.95% beyond 11 August lows.
Swiss GDP Data
The Switzerland economy grew lower in Q2 than most analysts’ expectations. According to the nation’s statistics agency, the Swiss economy soared by 0.3% in Q2, lower than the past 0.5%. The growth was slower than the 0.4% median estimate.
That translated to a 2.8% growth rate, lower than the 4.7% previous expansion. Moreover, it was worse than the 3.0% median estimate. The statistics agency revealed that deteriorated consumer spending & manufacturing triggered the slowdown. Meanwhile, the services sector partially offset the decline.
Thus, the USD-CHF price surged as investors forecasted that SNB (Swiss National Bank) would encounter challenges to continue rising interest rates despite elevated inflation.
The latest data shows the nation’s CPI (consumer price index) surged by 0.3% between July and August. It hiked by 3.5% Y/Y, the highest mark in decades.
Unfortunately, Switzerland will witness rising inflation in the upcoming months. First and foremost, the nation relies on Russian natural gas. Thus, the country will encounter challenges as Russia shuts Nord Stream 1 pipeline.
The USD-CHF also hiked amid a strengthening US dollar. The United States Dollar Index, which analyzes currency’s performance against several currencies, climbed to 20-year highs.
USD/CHF Prediction
The 4hr chart shows the USD-CHF exchange rate maintained a massive bullish bias within the last few weeks. Upside actions saw the pair climbing above the resistance zone of 0.9651 – the highest mark since 5 August.
The FX pair maintained upsides beyond the 25 and 50-day MAs. Also, it approaches the crucial resistance mark at 0.9886. Thus, USD-CHF will likely keep surging, targeting the 1.0 parity level.
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