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Forex - Dollar hovering just above record low against Swiss franc

Published 06/07/2011, 04:55 AM
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Investing.com – The U.S. dollar was trading close to a record low against the Swiss franc on Tuesday, as concerns over a slowdown in the rate of U.S. economic growth dampened demand for the greenback.

USD/CHF hit 0.8328 during European morning trade, the daily low; the pair subsequently consolidated at 0.8326, slipping 0.19%.

The pair was likely to find short-term support at 0.8250, and resistance at 0.8445, last Friday’s high.

Data on Friday showed that U.S. employment growth slowed sharply in May, reinforcing expectations that the Federal Reserve will not tighten monetary policy for some time to come.

Earlier in the day, official data showed that Switzerland's annualized rate of consumer price inflation increased slightly in May.

The Federal Statistics Office said annual inflation rose to 0.4% in May from 0.3% in April. Economists had expected it to remain unchanged at 0.3%.

Month-on-month, consumer prices remained flat, following a 0.1% rise the previous month. Economists had expected CPI to decline by 0.1% in May.

The soft data may see the Swiss National Bank delay raising its benchmark interest rate, as declining oil prices and the record strength of the Swiss franc may have contributed to dampening inflation.

Meanwhile, the Swissie was down against the euro, with EUR/CHF rising 0.47% to hit 1.2223.

Later in the day, Fed Chairman Ben Bernanke was to speak. His comments would be closely watched for his views on the U.S. economic recovery.


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