On Tuesday, the USD/CHF rebounded as investors remained cautious before the Slovak vote for expanding the European rescue fund later in the day, which enhanced demand on the dollar as a favorite safe haven amid the several interventions by the SNB to curb the franc’s advance. The Slovak Parliament will discuss the expansion of the EFSF amid frictions between policy makers regarding the broadening of the European lifeline.
Also, Trichet said on Tuesday “The crisis is systemic and must be tackled decisively,” while there is a divide among European leaders regarding how deep would be the Greek bond writedowns. On the other hand the joint statement by inspectors from the European Union, International Monetary Fund and European Central Bank, know as the troika, that Greece will probably get the next tranche of last year’s 110-aid package in early November did not have much impact on the pair as the main focus is on the Slovak vote.
On Wednesday, the U.S. MBA mortgage applications for October 7 will be available at 11:00 GMT, while the Swiss economy has no releases. The main focus will probably remain on the latest developments from the euro area to see officials’ ability to shore up the 17-nation economy.
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