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At the Forex currency market Swiss Franc rate tries to regain at least some of the losses on Wednesday morning, as those investors who hedge their positions against market instability have begun to show interest in the currency again.

Forex forecast: MACD indicator is in the negative area for the pair USD/CHF, and is going up, ready to break through the signal line from bottom to top and is shaping a buy signal, while volume are low. Stochastic Oscillator has come into overbought zone and continues to give a buy signal.

Forex recommendations: in case of breakdown at the level of 0.8160, the pair USD/CHF will go to 0.8180 and 0.8210.                         

Statistics released yesterday showed that consumption indicator UBS fell to 1.29 points in July against the level of 1.52 points in June. The indicator has been sliding down not for the first month, showing negative tendencies in the economy.

In general the economic situation in Switzerland remains unchanged. Earlier investors made use of the rumors that Swiss national Bank had distributed a letter to the banks about intention to impose a tax on deposit, which explains the weakness of the Franc. This information has not been confirmed and it is possible that SNB will intervene in the currency trading once again in order to prevent the Franc from strengthening.

Authorities of the country stated earlier that decision on the target level of Franc will be made by the CNB. We would recall situation of last week: Swiss National Bank intervened into the trades at the currency market; judging by the forwarding sector, SNB continued to pour liquidity at the trading floors to curb the growth of the Franc. Swiss National Bank had also restricted three- month Libor rate to 0-0.25% (it had amounted to 0-0.75% previously). They also stated that increasing rate of the Franc is a negative factor for the national economy; therefore Libor rate will tend to zero and the SNB is going to infuse liquidity into the market in the nearest future to “chill out” the Franc. Weighty argument of the SNB was that there is a threat to economic development and price stability.

It became known earlier that producer prices and imports prices in Switzerland declined by 0.7% m/m (-0.5% y/y) in July against the fall of 0.6% m/m in June. In addition, consumer confidence index in Switzerland fell to -17 points in Q3 against the forecast of -5 points.

According to the data released earlier, unemployment rate in Switzerland remained at the level of 3.0% in July. Statistics released earlier showed that the level of retail sales in Switzerland increased by 7.4% in June against the revised level of -3.9% in May. In addition, index of PMI SVME rose to 53.5 points in July against the forecast of 52.5 points.

GDP in Switzerland in Q2 will be known on Thursday, as well as the data on PMI in August and retail sales in July. The rise in volatility in the pair is possible on this day due to the great bulk of statistics.

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