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September/21/2011- Comments and forex-analytics from FBS

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September/21/2011- Comments and forex-analytics from FBS

Postby vanvirtue » Wed Sep 21, 2011 8:29 am

Switzerland: GDP forecast’s reduced

Switzerland’s government lowered its economic-growth forecasts for 2011 and 2012 from 2.1% and 1.5% to 1.9% and 0.9% respectively. Export growth estimate was trimmed from 4.6% this year and 3% the next to 3.2% and 0.7% respectively.

The reason for this downward revision is the fact Swiss franc’s rate is still excessively strong even after the Swiss National Bank has set the ceiling for the nation currency’s rate versus euro. According to the data released today, the nation’s exports fell in August by 7%.

The nation’s authorities say that isolated quarters of economic contraction are possible, though deep recession seems to be unlikely.

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Commerzbank: USD/CHF is gaining on the SNB talk

The greenback went up versus Swiss franc from the day’s minimum at 0.8692 getting above 0.8940 on the speculation that the Swiss National Bank has imposed a tighter peg for the national currency. There’s talk that the SNB has removed the EUR/CHF target up to 1.25 per euro. The central bank didn’t confirm the information, but franc is experiencing general weakness.

Technical analysts at Commerzbank note that USD/CHF has broken up important resistance at 0.8850/0.8950 (double Fibonacci retracement, 200-day MA and May minimum). In their view, US dollar is on its way up to 0.9103 (55-week MA) and 0.9340/0.9400 (March maximums and double Fibonacci retracement).

According to the bank, support for the pair is found at 0.8640/0.8462 (23.6%/38.2% retracement of dollar’s advance in September).

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