Forex - USD/CHF edges higher as dollar sentiment consolidates

Published 10/26/2010, 06:27 AM
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Investing.com – The U.S. dollar edged higher against the Swiss franc on Tuesday as sentiment on the dollar consolidated after remarks by the president of the New York Federal Reserve.

USD/CHF hit 0.9746 during European morning trade, a daily high; the pair subsequently consolidated at 0.9716, gaining 0.05%.

The pair was likely to find support at 0.9541, the low of October 18 and resistance at 0.9804, the high of October 22.

Earlier in the day, data from Swiss lender UBS showed that Swiss consumer demand deteriorated significantly in September. After a six-month climb, the UBS Consumption Indicator fell to 1.70, down from 1.95 in August.

The report said that the drop was partly due to declining retail sales as annual growth in new car registrations eased to 5.3%, down from 11.9% in August.

However UBS said it expected that consumption would continue to grow robustly in the coming quarters. "Low interest rates and an improvement in the labor market, as well as the ongoing strong increase in the permanent resident population, should continue to support private consumption," the bank said.

Meanwhile the Swissy was up against the euro, with EUR/CHF shedding 0.06% to hit 1.3556.

On Monday, New York Federal Reserve President William Dudley said that the Fed’s approach to more asset purchases depends on the economic context, saying "With QE2 it is a careful assessment of the costs and benefits and try to judge whether it makes sense to do or not."

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