In the Quarterly bulletin released yesterday, the increase in foreign currency bought by Switzerland to increase demand for CHF has had a negative impact on the Swiss Franc. The table below shows the difference in CHF you could have achieved when buying £200,000.00 during the high and low points of the past month.

Currency Pair% ChangeDifference on £200,000
GBPCHF4.1%10,850 CHF

Why has GBPCHF climbed this week?

GBPCHF rates have climbed by 2% this last week as a result of Sterling strength and CHF weakness. At the start of the week the price of the Pound gained across the board as the transitional negotiations were widely approved.

Why has Sterling Swiss Franc climbed this week?

Trade balance in CHF shows an excess

On Tuesday the latest Trade balance figures were released and showed a better than expected trade surplus, increasing from 2B to 3.14B in February. Most had expected a drop but this improvement helped give the CHF some strength on the day.

Yesterday the Quarterly bulletin was also released from the Swiss National Bank. This showed yet another increase in the amount of foreign currency the bank has bought in an effort to equal out the demand for their currency.  This was seen as negative for the CHF weakening its value and making it cheaper to buy giving the opportunity that we have currently for GBPCHF buyers sitting close to an 18 month high!

What next for the direction of the GBPCHF rate?

Next on the economic horizon are business confidence figures which are released on Wednesday of next week. This is already expected to show an improvement as demand for financial services continue to accelerate.

On the day I expect this to drive market direction but between then and now I think that political events globally will have a larger impact on the value of the CHF. Russia tensions are expected to escalate over the coming days as the UK Prime Minister Theresa May pushes her ‘European Cousins’ for support following the alleged chemical attack a fortnight ago on UK soil while she is at the European Council meeting.   This will probably push up demand for the CHF meaning that the any sellers of the CHF may want to wait for better levels on Friday afternoon if confirmed.

For more information on how future data releases could affect your currency requirement, call our trading floor on 01494 725 353 or email me here.

News

Read more articles
Exchange rates on this page are interbank rates and indicate where the market is trading to show the performance of a currency pair. They are not indicative of the rates which we offer. The information on this web site is provided free of charge for information purposes only. It does not constitute advice to any person on any matter. Foreign Currency Direct plc. ("FCD") makes every reasonable effort to ensure that this information is accurate and complete but assumes no responsibility for and gives no warranty with regard to the same.