Pound Sterling Swiss Franc (GBP/CHF) Exchange Rate Slips as Chinese Media Warnings Buoy Safe-Haven Franc
May 29, 2019 - Written by John Cameron
STORY LINK Pound Sterling Swiss Franc (GBP/CHF) Exchange Rate Slips as Chinese Media Warnings Buoy Safe-Haven Franc
Pound Swiss Franc (GBP/CHF) Exchange Rate Falls on Demand for Safe-Haven CHF
The Pound Sterling Swiss Franc (GBP/CHF) exchange rate slipped and the pairing is currently trading at an inter-bank rate of 1.2709Fr.
Data released on Wednesday morning revealed that the Swiss ZEW expectations survey contracted further.
In May expectations fell from -7.7 to -14.3, making this the 11th consecutive month this index has fallen.
However, investors flocked to the safe-haven Swiss Franc amid growing fears about trade and global growth.
Trade tensions between the US and China heightened today following warnings from Chinese state media.
Swiss Franc (CHF) Rises as US-China Trade Tensions Heighten
On Wednesday, the People’s Daily warned that China could restrict rare earth sales to the US, stating:
‘Will rare earths become a counter weapon for China to hit back against the pressure the United States has put on for no reason at all? The answer is no mystery.’
Meanwhile, tensions were further heightened following US Secretary of State, Mike Pompeo comments that there may or may not be a trade deal with China.
He also addressed Huawei, and in an interview with Fox Business Network, Mike Pompeo said:
‘Huawei is an instrument of the Chinese government. They’re deeply connected. It’s something that’s hard for Americans to understand.’
Sterling (GBP) Slides as No-Deal Risk on the Rise
It has been reported that some investment banks believe that the risk of a no-deal Brexit is on the rise once again.
Sterling held close to four-month lows on Wednesday and the currency has lost more than 3% in May making it its worst month in a year.
While the Conservative leadership contest has not officially begun, the list of hopefuls that wish to succeed Theresa May continues to grow.
This left the Pound dampened as many candidates have said they are prepared for a no-deal Brexit if Brussels refuses to reopen negotiations.
Pound to Swiss Franc Outlook: Will Disappointing Swiss Retail Sales Weigh on CHF?
Looking ahead to Friday, the Pound (GBP) could rise against the Swiss Franc (CHF) following the release of the UK GfK consumer confidence data.
If it is revealed that confidence rose higher than forecast in May, Sterling could receive an upswing of support.
Meanwhile, the Swiss Franc could slide against the Pound later in the day following the release of the Swiss real retail sales.
If April’s retail sales contract once again, it could dampen sentiment in the Franc, and cause the Pound Swiss Franc (GBP/CHF) exchange rate to rise.
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TAGS: Pound Swiss Franc Forecasts
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