Forexpros – The U.S. dollar slipped against the Swiss franc on Monday, as a combination of concerns over the outlook for global growth and ongoing worries over the euro zone sovereign debt crisis weighed on risk appetite.
USD/CHF hit 0.7840 during European morning trade, the daily low; the pair subsequently consolidated at 0.7867, shedding 0.19%.
The pair was likely to find support at 0.7710, last Friday’s low and resistance at 0.7959, the high of the same day.
Data on Friday, showing that the U.S. economy added virtually no jobs in August for the first time in almost a year added to expectations that the Federal Reserve will embark on a third round of monetary stimulus, to shore up faltering U.S. growth.
Meanwhile, the single currency remained under pressure after German Chancellor Angela Merkel’s ruling party were defeated in local elections on Sunday, amid dissatisfaction over her handling of the euro zone debt crisis.
The dollar remained supported as investors remained wary of further action by the Swiss National Bank to counter the Swissie’s gains. Early last month, Switzerland’s central bank slashed interest rates to near zero, saying the currency was “massively overvalued.â€
On Friday, the Swiss government issued a statement declaring that all parties stood behind the SNB’s actions and asserting that the central bank was solely responsible for currency policy.
The Swissie was also higher against the euro, with EUR/USD shedding 0.67% to hit 1.1122.
Also Monday, markets in the U.S. were to remain closed for the Labor Day holiday.
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