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Forex - USD/CHF edges higher on E.Z. debt concerns

Published 11/21/2011, 05:38 AM
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Investing.com - The U.S. dollar edged higher against the Swiss franc on Monday, as sustained concerns over the handling of the financial crisis in the euro zone supported safe haven demand.

USD/CHF hit 0.9208 during European morning trade, the daily high; the pair subsequently consolidated at 0.9203, rising 0.40%.

The pair was likely to find support at 0.9017, the low of November 10 and resistance at 0.9314, the high of October 6.

Market sentiment was hit after European Union economic and monetary affairs commissioner Olli Rehn said that Europe's sovereign debt crisis is hurting the core of the 17-country euro zone, warning there should be "no illusions" about its potential long-term impact.

Rehn defended austerity measures demanded by the European Commission that are aimed at rebuilding confidence but which have in some cases hit economic growth, deepening the crisis.

On Sunday, Spain’s center-right opposition People's Party won a crushing election victory and was expected to push through drastic austerity measures to try to shore up the country’s economy.

In the U.S., a congressional "super committee" was expected to formally announce the failure of its three-month-long effort to forge a USD1.2 trillion deficit reduction plan.

Meanwhile, the Swissie remained vulnerable amid speculation that the Swiss National Bank may lift the 1.20 floor against the euro, to reduce the risk of deflation and bolster growth.

The Swissie was higher against the euro with EUR/CHF shedding 0.14%, to hit 1.2379.

Later in the day, the U.S. was to release industry data on existing home sales.

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