Traders turned bitter on risk assets on concerns over rising geopolitical and pandemic risks. Risk catalysts for both currencies covered in the Swiss franc recap below.
European Headlines and Economic data
Italian industrial production fell by 28.4% m/m in March 2020
ECB Heads for more stimulus even as courts spar over limits
Germany infection rate rises as lockdown eases
Merkel believes German court’s ECB ruling is ‘solvable’: sources
ECB Rehn say German court trying to interfere with ECB independence
The Swiss Franc
Swiss Headlines and Economic data
A bit of up-and-down price action for both currencies on the session, once again on news headlines and risk sentiment flows.More fears of a second coronavirus wave sparked risk-off sentiment during the Asia session, but hopes of an economic recovery as countries end lockdown restrictions turn traders to positive sentiment during the London trading session.
Risk-on sentiment during London session on lockdown easing had the franc falling back during, but it was a quick flip to risk-off sentiment during Fed Chair Powell’s warning of extended economic weakness that had both currencies popping higher against the risk currencies during the U.S. session.
Risk-off sentiment picked up during the Friday session to extend the franc and euro’s gains against the risk currencies.
This shift was likely on a combination of weak economic updates from China, Germany, and the U.S., as well as on negative vibes on U.S.-China relations. (Trump administration moves to cut Huawei off from global chip suppliers)