Will the franc's rise continue?
05.10.2021
- France: Industrial Production
- UK Services PMI (Final Reading)
Yesterday, the three major U.S. stock indices all fell, creating a risk-off sentiment characterized by falling stock prices, rising interest rates, and higher oil prices. The rise in WTI crude oil prices was particularly sharp, with prices currently hovering around $77.40 per barrel—a high not seen in about seven years. Commodity prices are surging following reports that OPEC+ will maintain its reduction of production cuts by 400,000 barrels per day.
As of yesterday, the Swiss franc had become the strongest currency in the foreign exchange market, and the CHF/JPY pair rose sharply, climbing approximately 120 pips from 118.98 to 120.18. The CHF/JPY pair has broken above its recent high of 120.20 on the 4-hour chart, and depending on the strength of the U.S. dollar, we should keep in mind the possibility of a rise toward the daily high of around 120.27.
Today’s schedule includes French industrial production at 3:45 PM, the UK services PMI (final reading) at 5:30 PM, the Canadian and U.S. trade balances at 9:30 PM, the U.S. services PMI (final reading) at 10:45 PM,at 11:00 PM, the US ISM Non-Manufacturing PMI; at 12:00 AM, remarks by ECB President Lagarde; and at 2:15 AM, remarks by US Federal Reserve Vice Chair Quarles. Amid a general risk-off sentiment, we want to closely monitor how European currencies will respond.
Author: Keisuke Sakurai
