By FX Empire.com
The EUR/CHF was trading within a tight range on Wednesday with high volatility and fluctuations though holding marginally above 1.23 areas.
The pair lacks the major momentum to move where the euro softness is not reflected on the pair from expectations the SNB might move again to shelter its economy and halt the franc gains by raising the set floor.
The market continued to fluctuate heavily on Wednesday with the focus on the euro area debt crisis. Slight and temporary relief was seen from news that the ECB is heavily buying bonds in the market yet the effect did not last long with yields returning to rise and the euro resuming the losses with the dollar still the strongest across the board.
Investors fear the spread of the crisis and fear contagion with Italy now at risk and pressuring Spain and France with the rising borrowing costs.
On Thursday the volatility will be seen where the lack of euro area data will not affect the movement as the focus is on the debt crisis and the auction from France and Spain especially amid rising borrowing costs and after Tuesday’s auction from Spain to many was disappointing and below the maximum target although it was met with strong demand and still in the upper half of the target range/
Also the data from Switzerland has the capacity to affect the franc as the worsening outlook for the economy keeps fueling more expectations for SNB movement which might support the pair higher. The Credit Suisse Zew Survey for November is due at 10:00 GMT and the expectations index might have dropped further from the previous month’s -54.4.
Originally posted here
