Forex Pros – The U.S. dollar held small gains against the Swiss franc on Wednesday, to hover just above the pair’s all-time low as concerns over sovereign debt contagion in the euro zone supported demand for the safe haven franc.
USD/CHF hit 0.8280 during European morning trade, the pair’s lowest since June 28; the pair subsequently consolidated at 0.8312, edging up 0.08% .
The pair was likely to find short-term support at 0.8274, the low of June 28 and the pair’s record low and resistance at 0.8397, Tuesday’s high.
In the euro zone, markets began to focus on an emergency summit of European Union leaders due to be held on Friday, after policymakers acknowledged that some form of Greek default may be necessary in order to put the country’s debt on a more sustainable footing and prevent contagion to Italy and Spain.
Elsewhere, Tuesday’s minutes from the Federal Reserve’s June policy-setting meeting showed that some policymakers believe further monetary easing may be necessary if the U.S. recovery remains sluggish or if inflation moderates.
However, the dollar remained supported after official data showed earlier that Chinese gross domestic product expanded by 9.5% in the second quarter, easing concerns over a sharp slowdown in the world’s second largest economy.
The Swissie was sharply lower against the euro, with EUR/CHF rallying 0.93% to hit 1.1716.
Elsewhere, official data showed that Switzerland’s producer price index fell 0.5% in June, more than the forecast 0.2% decline, mainly due to lower prices for petroleum and metal products.
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