On Tuesday, the USD/CHF pair fluctuated amid hopes and fears before the European second summit on Wednesday. Some believes that European leaders are coming closer to launching a comprehensive plan on Wednesday while others see that there are still some hurdles.
Still, the main focus is on the European summit results after discussions that took place on Saturday. Also on Wednesday, German Chancellor Angela Merkel is looking forward to approving the expansion of the European Financial Stability Facility (EFSF) firepower in lower house of parliament for new EU summit measures.
Juergen Trittin, co-leader of Germany’s opposition Greens Party, said European leaders are seeking to recapitalize banks with roughly 100 billion euros while bolstering the EFSF to more than 1 trillion euros.
On the flip side, data from the U.S. showed that home prices slipped 3.8% from August 2010.
In general, the trading volume on the pair is not high as many investors refrained from taking positions on the franc amid possibilities the SNB may intervene again to raise the cap from 1.20 to 1.40, especially as many Swiss companies reported decline in profit on the back of the franc’s appreciation.
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