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Forex - Dollar at 7-week low against Swiss franc on easing talk

Published 08/23/2012, 06:11 AM
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Investing.com - The broadly weaker U.S. dollar fell to a seven-week low against the Swiss franc on Thursday, after the minutes of the Federal Reserve’s August meeting indicated that the bank may be close to implementing a third round of easing measures.

USD/CHF hit 0.9554 during European morning trade, the pair’s lowest since July 4; the pair subsequently consolidated at 0.9562, shedding 0.24%.

The pair was likely to find support at 0.9523, the low of July 4 and resistance at 0.9588, the session high.

The Fed minutes showed that many policymakers think additional easing may be warranted "fairly soon" unless there is evidence of a "substantial and sustainable" strengthening in the economic recovery.

Concerns over prospects for a third round of stimulus from the U.S. central bank overshadowed weak economic data out of the euro zone and China.

A report earlier showed that manufacturing activity in the euro zone improved in August, but remained in contraction territory for the 12th consecutive month, while service sector activity slumped to a two-month low.

A separate report showed that manufacturing activity in China slumped to a nine-month low in August, adding to concerns over a slowdown in the world’s second largest economy.

The Swissie was little changed against the euro, with EUR/CHF dipping 0.01% to 1.2009.

Later Thursday, the U.S. was to release its weekly government report on initial jobless claims, followed by preliminary data on manufacturing activity and official data on new home sales.


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