Swiss National Bank concerns over the weak currency/inflation link only provideda brief bout of support for the funding currency. A newspaper interview with SNBboard member, Hilderbrand, included the warning that he saw risks for higher inflation from the weak Franc and that a sudden turn in the currency could hurt investors.
The SNB is expected to back up its recent currency rhetoric with an interest rate hike in March and while a 1/4-point move is the consensus there isspeculation that a half-point move could be signaled. USD/CHF fell sharply last session having failed at 1.2520-25 on Monday.
There was a good clear out of stale longs, a hangover from early January, but support at 1.2380 was not threatened and a modest bounce from 1.2390 to 1.2425 seen since the Tuesday close. As with EUR/USD the bigger picture highlights a sideways bias with range extremes set at 1.2375 and 1.2575.
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