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CHF Currency Report | Dec 02 2020

Updated: Dec 17, 2020

The Swissie (CHF) has been appreciated 1.92% this week to $1.1225/USD against a weaker US dollar, today reaching its strongest level since September 2015. The release of strong Swiss economic data boosted the CHF/USD pair upward. In particular, Non-Farm Payrolls (Q3) grew to 5.138M, from a previous 5.095M in Q2 and a stronger than expected GDP Growth Rate year over year (Q3) at -1.6%, which was forecasted to be -3.3%.

Other strong economic data includes:

· GDP Growth Rate quarter over quarter (Q3) at 7.2% improved strong recovery from -7% in Q2

· Manufacturing PMI (NOV) at 55.2 was greater than forecasted 51.6

This gross appreciation of the CHF comes as bad news for Switzerland’s large export business who has struggled with a strong CHF since March 2020.

Technical Analysis

Since August 2020, the CHF/USD was trading between 1.11 and 1.07, resistance and support, respectively. However, since the Thanksgiving Holiday on Nov, 26th, the pair managed to breach the 1.11 level and went up to seek 1.12 level, making it its new potential resistance level, as seen in Deaglo’s spot chat below.

SNB | On December 3rd, the Swiss National Bank (SNB) announced its success in trialing digital money as a means of settling large-scale transactions between financial institutions. However, cynicism still persists pertaining to the use of its own digital currency. SNB governing board member Andrea Maechler said the project showed wholesale central bank digital currencies “CBDCs” are feasible from a technical and legal perspective, but their success did not infer the SNB was committed to issuing one anytime soon. Read more here

Upcoming events likely to influence the CHF are:

· Unemployment rate for November (due 8 DEC);

· Foreign Exchange Reserves for November (due 7 DEC)

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