Investing.com - The dollar dipped against the traditional safe haven Swiss franc on Friday, paring a weekly gain, amid heightened tensions between the West and Russia over Ukraine.
USD/CHF edged down 0.09% to 0.8828 at the close, down from the two-week highs of 0.8868 reached on Thursday. For the week, the pair gained 1.08%.
The pair is likely to find support at 0.8750 and resistance at 0.8875.
Caution returned to markets as the political standoff between the West and Russia following the annexation of Crimea escalated, after the U.S. imposed harsher sanctions on Moscow. The European Union also agreed to wider sanctions against Russia on Friday, fanning concerns over the impact on global growth.
The dollar had racked up strong gains against the franc in the previous two sessions, bolstered by expectations that the Federal Reserve could hike interest rates earlier than previously thought.
The dollar strengthened across the board Wednesday after Fed Chair Janet Yellen indicated that the bank could begin to raise interest rates about six months after its bond-buying program winds up, which is expected to happen this fall.
The comments prompted investors to bring forward expectations for a rate hike to as soon as March of next year.
The Fed also reduced its monthly bond purchases by an additional $10 billion to $55 billion at the conclusion of its two-day policy meeting, and said there was “underlying strength in the broader economy.”
Meanwhile, the Swiss National Bank left rates on hold at zero after its policy setting meeting on Thursday and said it was maintaining its exchange rate floor against the euro.
The SNB reiterated it would enforce the 1.20 per euro minimum exchange rate floor with unlimited interventions if necessary, and added that it remained ready to take further measures.
The central bank confirmed its forecast that the Swiss economy will grow by around 2.0% in 2014. It revised down its inflation forecast, saying consumer prices will remain flat this year and rise 0.4% in 2015.
In the coming week, investors will be looking ahead to U.S. data from the housing sector, as well as reports on consumer confidence and durable goods. Switzerland has no economic reports scheduled for release during the week.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday, March 24
The U.S. is to release preliminary data on manufacturing activity.
Tuesday, March 25
The U.S. is to release report on house price inflation and consumer confidence, as well as official data on new home sales.
Wednesday, March 26
The U.S. is to release data on durable goods orders, a leading indicator of production.
Thursday, March 27
The U.S. is to publish final data on fourth quarter economic growth. The nation is also to release the weekly report on initial jobless claims and private sector data on pending home sales.
Friday, March 28
The U.S. is to round up the week with a report on personal spending and revised data on consumer sentiment.