Into North American trading and the Dollar is back under the cosh as the weight of expectation for the Q1 GDP release causes a fresh waves of selling. Advanced US Q1 GDP is set for release at 12:30 GMT. The Commerce Dept. releases its first estimate and economists expect a +1.8% annualized rate of growth. USD/CHF has been forced back to 1.2040 intraday but bids into the 1.2030 mark are eyed by bears should the US unit remain under pressure. Following the early data, the attention will turn to the 14:00 GMT unveiling of April final Michigan Sentiment. A median reading of 85.2, compared with the 88.4 previous, is forecast.
Local dealers cite the hawkish Roth comments and the solid KoF headline as a reason to sell USD/CHF into strength. The Leading Indicator may not have matched the markets 2.00 expectations but the results remain robust and when combined with the Roth rhetoric, on the need for higher Swiss rates, we would agree that further Swiss Franc strength looks sustainable in the medium-term with 1.1995/2000 targets also persisting.
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