Much love for the euro this week, possibly on hopes of a recovery fund agreement and improving economic updates, while the Swiss franc soured on comments from the Swiss National Bank on keeping an expansive monetary policy.
European Headlines and Economic data
The Swiss Franc
Swiss Headlines and Economic data
Net negative start to the week for the Swiss franc as global risk sentiment was leaning positive on weekend news that Trump finally wore a mask, and possibly on news that Pfizer, BioNTech’s coronavirus vaccine getting FDA’s ‘fast track’ status.
But we did see risk sentiment flip back to negative during the U.S. session after news broke of California closing a variety of businesses back down to send the franc higher.
Swiss National Bank says expansive policy ‘more necessary than ever’ – the big reversal of the week back to the downside for the franc correlates with this event as traders priced in expectations of currency intervention from the SNB for the foreseeable future.
A positive boost to global risk sentiment on Wednesday from positive vaccine news from Moderna and positive earnings numbers from U.S. equities, were the likely drivers for another push lower from CHF bears on the session.
The franc bottomed out and bounce during the Thursday U.S. session, likely on negative risk sentiment sparked by a combination of negative U.S. economic data (U.S. Weekly jobless claims rise by more than 1 million for 16th straight week) and geopolitical news (U.S. Weighs Sweeping Travel Ban on Chinese Communist Party Members).
The Swiss franc recovered further during the Friday trading session with no direct catalysts or strong push from global risk sentiment. It’s likely the franc traded higher with the euro, which was on the rise on hopes of a EU recovery fund agreement this weekend.