Should We Keep a Close Eye on the Swiss Franc, Which Is Being Bought Amid the Israel Crisis?
16.10.2023
- European and Foreign Currency Reserves
- Harker (U.S.): Remarks by the President of the Federal Reserve Bank of Philadelphia
Last weekend, following the release of the U.S. CPI on the 12th, the U.S. dollar strengthened against European currencies. The GBP/USD pair fell by just over 100 pips from 1.2224 to 1.2122, marking its second consecutive day of declines.From a technical perspective, GBP/USD has once again fallen below the 20-day moving average (MA) on the daily chart, setting the stage for a potential continuation of the downtrend. We will be closely monitoring whether the U.S. dollar strengthens against the pound ahead of the UK CPI release scheduled for the 18th of this week.
Among European currencies, the Swiss franc emerged as the strongest currency after Switzerland’s September producer import prices, released on the 13th, stabilized at -0.1% from the previous month’s -0.2%.The USD/CHF pair fell by about 80 pips from 0.9085 to 0.9002, offsetting the previous day’s gains.Due to yesterday’s decline, USD/CHF has retreated back to the 200-period simple moving average (SMA) on the 4-hour chart and has also returned to just below the 200-period SMA on the daily chart. However, since the lows are rising on the 4-hour chart, this could be seen as a retest of the 200-period SMA, so we will be watching price action closely during European trading hours.
Today’s schedule includes the German Wholesale Price Index at 3:00 p.m., the Indian Wholesale Price Index at 3:30 p.m., the Czech Producer Price Index at 4:00 p.m., Turkey’s fiscal balance at 5:00 p.m., and the Eurozone’strade balance, at 7:00 PM: Israel’s GDP and the Eurozone’s foreign exchange reserves, at 9:30 PM: Canada’s wholesale sales and manufacturing sales, the U.S. New York Fed Manufacturing Index, at 11:30 PM: U.S. remarks by Harker,Remarks by Philadelphia Fed President Harker; at 24:30, U.S. 3-month/6-month Treasury auctions; and at 30:00, South Korea’s import and export price inflation rates are scheduled. We will carefully monitor the movements of the Swiss franc, which is being bought amid the Israel situation.
Author: Keisuke Sakurai
