Investing.com – The U.S. dollar plummeted to a new record low against the Swiss franc on Thursday, after a surprise decision by Singapore’s central bank to tighten monetary policy piled pressure on the ailing greenback.
USD/CHF hit 0.9466 during European morning trade, a new all time low; the pair subsequently consolidated at 0.9504, plunging 0.80%.
The pair was likely to find short-term support at 0.9400 and resistance at 0.9697, the high of October 8.
Earlier in the day, the Monetary Authority of Singapore tightened policy, broadening the range of the Singapore dollar's trading band. At the same time, the authorities said they were maintaining a policy of "modest and gradual appreciation" of the local dollar.
The MAS cited "volatility across international financial markets" as a reason for its decision. The central bank uses currency value rather than interest rates as its main monetary policy tool because foreign trade eclipses the island's domestic economy.
Immediately following the move, the U.S. dollar fell to a record low of 1.2886 against the Singapore dollar. The U.S. dollar has already come under pressure in recent weeks amid expectations that the Federal Reserve will begin to implement further monetary easing if inflation remains too low or unemployment too high.
Meanwhile, the Swissy was down against the euro, with EUR/CHF gaining 0.05% to hit 1.3384.
Later in the day, the U.S. was to publish official data on initial jobless claims, as well as data on inflation and the country’s trade balance.
USD/CHF hit 0.9466 during European morning trade, a new all time low; the pair subsequently consolidated at 0.9504, plunging 0.80%.
The pair was likely to find short-term support at 0.9400 and resistance at 0.9697, the high of October 8.
Earlier in the day, the Monetary Authority of Singapore tightened policy, broadening the range of the Singapore dollar's trading band. At the same time, the authorities said they were maintaining a policy of "modest and gradual appreciation" of the local dollar.
The MAS cited "volatility across international financial markets" as a reason for its decision. The central bank uses currency value rather than interest rates as its main monetary policy tool because foreign trade eclipses the island's domestic economy.
Immediately following the move, the U.S. dollar fell to a record low of 1.2886 against the Singapore dollar. The U.S. dollar has already come under pressure in recent weeks amid expectations that the Federal Reserve will begin to implement further monetary easing if inflation remains too low or unemployment too high.
Meanwhile, the Swissy was down against the euro, with EUR/CHF gaining 0.05% to hit 1.3384.
Later in the day, the U.S. was to publish official data on initial jobless claims, as well as data on inflation and the country’s trade balance.