Intraday and USD/CHF has remained a Dollar led pair but with flows in EUR/CHF finally increasing the price is beginning to show potential for Franc strength rather than pure-USD weakness. However, into NorAm trading and the US data & Bernanke and Greenspan comments will drive volatility.
Elsewhere, the latest publication of the Swiss Consumption Index by UBS has seen the index rise to 1.96 in October from the 1.83 in September. The data shows that the Swiss consumer is actively contributing to the current robust nature of the alpine economy. It also reinforces the need for the SNB to continue tightening into the year-end. Looking ahead, domestic players look to the release of the November CPI data, due Thursday at 06:45 GMT, to confirm the potential for Roth & Co to move rates in Q4.
CPI is expected to have risen 0.2% on the month and +0.7% on the year, compared to the 0.3% for both seen previously, as higher rents are offset by lower oil and energy prices. We at IFR still price in a further 25bp target LIBOR hike at the Q4 meeting in December.
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