_iNVEZZ.com: Thursday, March 20th:_ The USD/CHF has today extended its gains from yesterday reaching its highest point since 6 March, at 0.8843. At press time the pair is changing hands at 0.8842, up 0.25 percent intraday and 1.23 percent intraweek.
The price yesterday scored a 0.85 percent gain, closing at 0.8817, after the US Federal Open Market Committee (FOMC) decided to scale back its monthly bond buying programme by $10 billion to $55 billion.
Fed chair Janet Yellen also remarked that interest rates could be raised six months after economic stimulus had been ended.
The USD/CHF rally was also supported by ZEW Swiss economic expectations for the next six months falling for a third consecutive month, to 19 points this month from 28.7 in February.
The current economic situation in Switzerland is assessed by ZEW as being only slightly worse than in February. The respective indicator has declined by 4.7 points to 42.9 points.
The Swiss National Bank (SNB) today decided to keep its minimum exchange rate of CHF1.20 per euro saying the nation’s currency was “still high”.
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“Current tensions with regard to emerging markets generally and Ukraine in particular highlight that it’s too early for them to take away the floor,” says BNP Paribas economist David Tinsley. “There’s certainly no pressure to do anything from an inflation angle – it looks extremely soft.”
The SNB also kept the target range for three-month Libor unchanged at zero to 0.25 percent.
The central bank is now expecting the inflation rate to be 0.2 percentage points lower for both this and next year, at zero percent and 0.4 percent respectively. GDP is still anticipated to grow at around two percent for the whole of this year.
The Swiss Federal Statistical Office reported that the trade balance surplus expanded to a seasonally adjusted CHF2.616 billion in February from CHF2.55 billion in the prior month which was revised down from CHF2.594 billion.
Exports fell 0.4 percent to a level of CHF17.019 billion and imports dropped to CHF14.403 billion from CHF14.602 billion in January.
Today’s resistances: 0.8870, 0.8890 and 0.8915.
Supports: 0.8765, 0.8745 and 0.8725.