April 1, 2019 - Written by John Cameron
STORY LINK Pound Swiss Franc (GBP/CHF) Exchange Rate Increases as Swiss PMI Figures Ease
GBP/CHF Exchange Rate Rises as Swiss Retail Figures Fall
The Pound Swiss Franc (GBP/CHF) exchange rate edged higher today and is currently trading around 1.3053fr.
The Swiss Franc (CHF) fell against the stronger Pound (GBP) today following the release of the Swiss real retail sales figures for February, which fell by -0.2%.
These were followed by the publication of the Swiss SVME PMI figures for March which narrowly avoided contraction at 50.3, further weakening market confidence in the Swiss Franc.
CHF is struggling as the Swiss economy is showing signs of sluggishness following today’s disappointing economic data.
Today also saw the International Monetary Fund (IMF) predict that Switzerland’s economic growth could slow to 1.1% in 2019. The IMF indicated that these are due to rising trade tensions and continuing political upheavals throughout Europe – all factors which weigh on the Swiss economy.
The Pound, meanwhile, has benefited on rising hopes that tonight’s ‘indicative votes’ by MPs will determine – and hopefully break – the Brexit deadlock over Prime Minister Theresa May’s Brexit deal, offering alternative compromises which lessen the chances of a no-deal.
GBP/CHF Exchange Rate Edges Higher on Brexit ‘Indicative Votes’ Hopes
Hopes are continuing to rise on MPs voting in support of the common market 2.0 amendment which would likely see the UK and the EU secure a deal.
A party spokesman for the Labour party said today:
‘In line with our policy, we’re supporting motions to keep options on the table to prevent a damaging Tory deal or no deal, build consensus across the house to break the deadlock and deliver an outcome that can work for the whole country.’
Today also saw the publication of the UK Markit Manufacturing PMI figures for March. Increasing above expectation, these buoyed market confidence in Sterling.
Rob Dobson, a Director at IHS Markit, commented:
‘Manufacturers reported a surge of business activity in March as companies stepped-up their preparations for potential Brexit-related disruptions. Output, employment and new orders all rose at increased rates as manufacturers and their clients raced to build safety stocks.’
However, with Brexit in the spotlight many Sterling traders have been paying close attention to developments ahead of this evening’s important vote. Hopes have been running high that this could end the Brexit stalemate, and this has had the Pound rising above the Swiss Franc.
GBP/CHF Forecast: Sterling Could Rise if a No-Deal Brexit is Avoided
Swiss Franc traders will be looking ahead to tomorrow’s release of the Swiss Consumer Price Index figures for March, and with any signs of improvement this could see the CHF/GBP exchange rate rise.
Sterling investors, meanwhile, will be awaiting tomorrow’s printing of the UK Markit Construction PMI figures for March.
The GBP/CHF exchange rate will remain sensitive to tonight’s vote, and with any signs that the UK and the EU could reach a deal on any of the forwarded alternatives, this could see Sterling soar as a no-deal Brexit recedes.
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