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CHF: Swiss Franc will have to face with shaping of trend
Swiss Franc rate makes no headway, being close to the start session level at the Forex currency market on Monday in anticipation of new catalysts for the formation of a trend.
Forex forecast: MACD indicator is in the negative area for the pair USD/CHF and continues to go down, giving grounds for a pair sell signal. Stochastic Oscillator is giving an antipodal signal today being in the neutral area.
Forex recommendations: off the market.
Feasible event scenario at Forex: in case of breakdown at the level of 0.9720 the pair will go to 0.9760 and 0.9800. If the level of 0.9650 is exceeded, traders’ targets will be the levels of 0.9610 and 0.9550.
According to the assessment of KOF, Swiss Institute of research of economic cycles, Swiss Franc will retain the status of safe asset and a status of a refuge for the whole period of tension in Europe.
In addition, KOF has revised its forecast for GDP growth upward in 2011; is it projected that Swiss economy will increase by 1.9% in 2011 against the previous forecast of 1.8%. In 1012 national economy is expected to rise by 2%.
This year, GDP growth in Switzerland can amount to 2.7%.
This forecast is based primarily on the belief that the SNB will increase interest rate by mid-2011. In addition growth of the rate will be insignificant because CNF is constantly under pressure from a growing trend, which is caused by European problems and demand for currency as a protective asset. That is why CHB cannot yet return to its standard monetary policy.
We would remind that at the meeting which was hold last week, Swiss National Bank decided to maintain three months rate Libor in the previous target range of 0-0.75. This decision of the Bank was expected by the market. Index was revised in March 2009 the last time when it was reduced by 0.25%.
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