The Swiss Franc is trading higher against the Euro, Pound and is close to hitting a 19-month high against the US Dollar as concerns over the possible economic impact of the US government shutdown bolstered demand for the safe haven currency.
The Franc edged higher against the Euro as the market awaits the release of the European Central Banks policy meeting minutes which is expected to show a maintaining of the current record low interest rate of 0.5%. Investors have also been spooked by the ongoing political disruption in Italy which has seen Prime Minister Enrico Letta address his nation’s senate in a bid to salvage his government.
When he addresses this afternoon’s press conference European Central Bank President Mario Draghi is expected to rely more on his words than on new policies to aid the Eurozone through its economic recovery.
“Communication has clearly been the ECB’s preferred tool for the past few months and it still is. Draghi will keep using words rather than deeds. He will say that more long-term loans are still on the table and he may even hint at another LTRO being deployed by the end of the year, but I don’t expect any policy action today,” Christian Schulz senior economist at Berenberg told Bloomberg.
The closure of the federal government in the US has also weighed heavily upon risk sentiment as investors grow increasingly concerned that the longer the shutdown lasts the more likely it is for the Federal Reserve to maintain its monetary stimulus programme for longer. Last month the U.S. central bank took markets by surprise with a decision to keep its stimulus program on track, saying it wanted to see more evidence of a sustained economic recovery before tapering.
Current Swiss Franc (CHF) Exchange Rates
Swiss Franc/ Euro Exchange Rate is currently in the region of: 0.8169
Swiss Franc/US Dollar Exchange Rate is currently in the region of: 1.1056
Swiss Franc/ Pound Sterling Exchange Rate is currently in the region of: 0.6822
Swiss Franc/ Australian Dollar Exchange Rate is currently in the region of: 1.1835
(Correct as of 12:30 pm GMT)
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