Forex Pros – The U.S. dollar rose to a two-week high against the Swiss franc on Wednesday, after official data showed that Swiss producer price inflation declined unexpectedly last month.
USD/CHF hit 0.8502 during European morning trade, the pair’s highest since June 1; the pair subsequently consolidated at 0.8496, gaining 0.50%.
The pair was likely to find support at 0.8346, Tuesday’s low and resistance at 0.8542, the high of June 1.
The Federal Statistical Office said the producer price index declined 0.4% year-on-year, faster than economists’ forecast of a 0.1% fall. Compared to the previous month, the index fell 0.2%, confounding expectations for a 0.1% increase.
The producer price index for domestically produced goods dropped 0.4% month-on-month, while import prices dropped 0.3%.
On Tuesday, the Swiss government lowered its 2012 growth forecast, saying that any further franc gains would threaten economic expansion “to a serious degree.”
Meanwhile, the Swissie was up against the euro, with EUR/CHF shedding 0.45% to hit 1.2153.
Later in the day, the U.S. was to publish official data on consumer price inflation, as well as reports on foreign investment, industrial production and manufacturing activity.
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