Forex - USD/CHF comes off 2-1/2 month low, upside limited

Published 09/10/2012, 06:26 AM
USD/CHF
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EUR/CHF
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Investing.com - The U.S. dollar came off a two-and-a-half month low against the Swiss franc on Monday, as markets steadied following Friday’s risk rally, but the greenback’s gains were limited by expectations for fresh stimulus measures by the Federal Reserve.

USD/CHF hit 0.9484 during European morning trade, the session high; the pair subsequently consolidated at 0.9470, gaining 0.31%.

The pair was likely to find support at 0.9432, the session low and a two-and-a-half month low and resistance at 0.9557, the high of July 2.

The greenback remained under pressure amid growing expectations that that the U.S. central bank will implement further stimulus measures to strengthen the economic recovery in the wake of disappointing U.S. jobs data on Friday.

The U.S. economy added 96,000 jobs in August the Department of Labor said, well below expectations for 125,000, following a downwardly revised 141,000 in July.

But investors remained cautious ahead of a German court ruling on the constitutionality of the European Stability Mechanism on Wednesday.

Risk appetite remained supported after the European Central Bank unveiled details of its bond purchasing program on Thursday, which is aimed at lowering the borrowing costs of peripheral euro zone members.

Earlier Monday, a report showed that investor confidence in the euro zone improved this month for the first time since March, largely due to optimism surrounding the ECB’s bond purchasing plan.

The Swissie was steady against the euro, with EUR/CHF dipping 0.02% to 1.2098.

Trade was expected to remain subdued on Monday, as investors looked ahead to Wednesday’s German court ruling on the euro zone’s bailout fund, as well as the outcome of the Fed’s policy meeting on Thursday.


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