Forex Pros – The U.S. dollar edged higher against the Swiss franc for a second day on Wednesday, after Tuesday’s softer-than-expected inflation data dampened expectations that the Swiss National Bank would raise interest rates in the near future.
USD/CHF hit 0.8812 during European morning trade, the daily high; the pair subsequently consolidated at 0.8805, easing up 0.11%.
The pair was likely to find short-term support at 0.8705, Tuesday’s low and resistance at 0.8891, the high of April 21.
Data on Tuesday showed that Swiss consumer price inflation came in at an annual rate of 0.3% in April, far below forecasts for an expected increase of 0.7%.
The slight increase in prices in April was due to higher prices for clothing and oil products, while lower food prices helped to dampen the rise.
Also Tuesday, Switzerland’s consumer sentiment index dropped to -1 in the second quarter, from 10 points in the first quarter. This was largely due to households turning more negative about their savings outlook.
Meanwhile, the Swissie edged higher against the euro, with EUR/CHF dipping 0.05% to hit 1.2667.
Later Wednesday, the U.S. was to publish official data on its trade balance. In addition, the country was to publish government data on crude oil inventories and the federal budget balance.
ForexPros.com
