Strength of Swiss Franc Signals About Worsening Sentiment

Markets started Thursday’s trading session in a positive mood. The Swiss franc, being considered a safer currency, was soft as a result of that. But currently, the Swissie has managed to gain against almost all of its most-traded peers. It also erased losses versus the Australian dollar, which had been the strongest currency on the Forex market during the early Thursday trading.
 
Among the possible reasons for the markets’ positive sentiment was the meeting between the US and Chinese officials next week. Analysts speculated that hopes for improving relations between the world’s two biggest economies made market participants more optimistic and willing to risk. Such hopes resulted in a rally of global stocks, with Dow Jones reaching a new record high yesterday, which also contributed to the investors’ good mood. Why the mood worsened, as the rally of the Swiss franc suggests, is hard to tell at present.
As for news in Switzerland itself, the State Secretariat for Economic Affairs released an updated economic forecast. The forecast for growth of the gross domestic product, adjusted for sports events, this year remained unchanged from the December projection, staying at 3.0%. The outlook for GDP growth in 2022 got a positive revision from 3.1% to 3.3%. The outlook for consumer inflation got a revision from 0.1% to 0.4% in 2021 and from 0.3% to 0.4% in 2022. The report said:

The Expert Group largely confirms its previous assessment. GDP is set to de-crease in the first quarter of this year, but the easing of coronavirus measures should subsequently lead to a rapid recovery. Uncertainty remains extremely high.

USD/CHF dropped from 0.9295 to 0.9246 as of 11:52 GMT today after rising to the session high of 0.9309 earlier. EUR/CHF declined from 1.1089 to 1.1066. AUD/CHF was up from 0.7188 to 0.7224 intraday but retreated to trade near the opening level later.
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Original from: www.earnforex.com