Ahead of the North American open and USD/CHF is consolidating the drift into the 1.22's. Offers ahead of 1.2220 have been retested but have once more stood firm despite spot continuing to look supported. Dealers also cite buying in EUR/CHF as having an impact on the Dollar pair but sales into the 1.62's in the cross are attempting to thwart further strength both here and in USD/CHF.
Looking ahead, domestic dealers note the event-risk on the horizon for the Swissie and this could weigh on the CHF. However, we at IFR expect the latest UBS Consumption Indicator, for February, to show a fairly healthy growth while the Swiss KOF Leading Indicator is expected to rise slightly.
As a result the Franc could look to eke gains into the end of the week as solid consumption growth and continued investment underpin the robust nature of Swiss fundamentals. Thus speculative accounts may look to sell topside failures for smaller gains, with only a break below 1.2160 support opening the downside in the short-term.
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