Forexpros – The U.S. dollar tumbled to a record low against the safe haven Swiss franc on Monday, as talks on raising the U.S. debt ceiling remained deadlocked and Greece’s sovereign debt rating was downgraded by Moody’s Investor Services.
USD/CHF hit 0.8042 during European morning trade, the pair’s all-time low; the pair subsequently consolidated at 0.8051, falling 1.76%.
The pair was likely to find support at 0.8000 and resistance at 0.8154, the days high.
The U.S. Senate rejected a USD3 trillion deficit reduction plan on Friday, adding to fears over a possible downgrade or default ahead of the August 2 deadline to raise the country’s USD14.3 trillion debt ceiling.
Both Moody’s Investors Service and Standard & Poor’s have placed their credit ratings on U.S. debt on review for a potential downgrade.
House Speaker John Boehner told Republican lawmakers on a conference call Sunday evening that no “grand deal” on raising the debt ceiling was possible with President Barack Obama.
Elsewhere, Moody’s cut Greece’s sovereign debt rating by three notches to Ca earlier Monday, just one notch above default, saying the new aid package set a negative precedent for the creditors of other indebted nations.
The Swissie was also sharply higher against the euro, with EUR/CHF falling 1.52% to hit 1.1581.
On Sunday, White House Chief of Staff Bill Daley warned that there would be “a few stressful days” ahead for financial markets, in the event that the Congress fails to agree on a plan by the end of Sunday.
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