Intraday the Swiss Franc has continued to feel the pressure of the carry, as the CHF remains the favored tool to fund various positions. As a result the Swissie is noted as the weakest of the European set with USD/CHF bought to a fresh 3-day high at 1.2708 while EUR/USD was rallied to 1.5925 as the CHF weakness was accentuated by the steadier Euro.
Looking ahead, the US FOMC meeting that kicks-off today is expected to drive short & longer-term sentiment towards the Dollar. However, the two-day meeting forces the market to mark time ahead of the verdict tomorrow.
Elsewhere, look for a change in the tone of official rhetoric from the central bank Chairman in his speech later today. The SNB's Roth (who is due to speak at 15:45 GMT in Zurich) has of late taken a slightly more positive view than the broader pessimistic SNB outlook. However, with data beginning to reflect the view that 2007 could hold scope for a more acute slowdown, there is likely to be growing pressure on the central bank head to explain the official line on both the current outlook and the potential implications of such a move.
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