Swiss Franc Strengthens Against Most Majors
The Swiss franc edged higher against most of its major rivals in early European trading on Friday as China’s latest monetary tightening move on Thursday and lingering Greece debt concerns prompted traders to seek safe-haven currencies.
In economic news, Switzerland’s Federal Statistical Office said its producer and import price rose 0.1 percent on year and 0.3 percent on month in April. Economists had expected the index to grow 0.5 percent annually, following last month’s 0.4 percent growth.
China raised banks’ reserve requirement on Thursday for the fifth time this year after data showed inflation exceeded 5 percent for the second straight month in April.
The Swiss franc advanced to a 3-day high of 1.4356 against the pound around 3:45 am ET, up from 1.4408 hit late New York Thursday. If the alpine unit strengthens further, 1.4290 is seen as the next likely target level. The pound-franc pair is presently trading at 1.4360.
Against the US dollar, the Swiss franc climbed to a 2-day high of 0.8813 around 4:10 am ET and this may be compared to yesterday’s close of 0.8843. The greenback-franc pair is presently worth 0.8810 with 0.8780 seen as the next likely target level.
Bouncing back from its Asian session’s new multi-week low of 90.84 against the yen, the Swiss franc inched higher to 91.63 around 4:10 am ET. The franc-yen pair is presently worth 91.57 with 92.30 seen as the next likely resistance level.
Moving off its recent low, the Swiss franc held steady against the euro during early European session on Friday. The franc is presently quoted at 1.2622 against the euro, up slightly from its Asian session’s 2-day low of 1.2645. The pair closed yesterday’s deals at 1.2596.
In economic news, German economy expanded more than expected in the first quarter, data from the Federal Statistical Office revealed today.
The Gross Domestic Product (GDP) grew by a seasonal and calendar adjusted 1.5 percent quarter-on-quarter during the first three months of 2011. That was considerably larger than the fourth quarter’s 0.4 percent growth and the 0.9 percent expansion estimated by economists.
Meanwhile, the French economy expanded 1 percent sequentially in the first quarter, logging the biggest growth since the second quarter of 2006, data from the statistical office Insee showed. This follows a 0.3 percent expansion in the fourth quarter of 2010. Economists were expecting a sequential GDP growth of 0.6 percent.
Looking ahead, the Eurozone preliminary first quarter GDP data is due out at 5:00 am ET. The 17-nation currency bloc is expected to grow at a faster pace of 0.6 percent in the first quarter after rising 0.3 percent in the previous quarter.
From the U.S., CPI for April and the University of Michigan’s preliminary consumer confidence report for May are slated for release in the New York morning session.
