The past week has seen the Pound Sterling to Swiss Franc (GBP/CHF) exchange rate rise steadily from 1.4967 to 1.5262, although this week Sterling has generally trended around the 1.5235 mark against the ‘Swissie’.
The Pound was dealt something of a bad hand last week as it suffered from a succession of detrimental economic releases. The Confederation of British Industry (CBI) results on Monday all printed negatively, while the detrimental GDP results on Tuesday added to the general sense of uncertainty floating around Sterling. Although Thursday brought some light relief with UK Lending outcomes for September, this was quashed by another CBI result, the Reported Sales figure for October, which fell dramatically from 49 to 19.
For the week so far, Sterling has seesawed due to UK PMI releases, which alternately provided a great deal of support on Monday and put the Pound in a middling position today. The UK PMI for Manufacturing rose from 51.8 to 55.5 yesterday against predictions of a decline, while today’s in-line-with-forecasts decline from 59.9 to 58.8 for the October Construction PMI destabilised Sterling, putting it in a pattern of narrow trending against most opposition currencies.
The Swiss Franc has conversely been unanimously supported by PMI results this week, owing to their only being one positive one so far, the SVME Manufacturing PMI for October that was released yesterday.
For the rest of this week, Pound Sterling/Swiss Franc exchange rate movement may occur as a result of the Swiss UBS Q3 Real Estate Bubble Index, the UK Composite and Services PMIs for October, the Swiss SECO Consumer Confidence result for October and the Bank of England (BoE) Interest Rate Decision and Inflation Report.
Due out tomorrow, Switzerland’s Real Estate figure has not yet been predicted, but with both UK PMIs, growth had been forecast at the time of writing. The Composite figure is expected to rise from 53.3 to 53.6, while the Services result has a predicted increase from 53.3 to 54.5. The Swiss Consumer Confidence result is due out on Thursday, but according to forecasts is expected to post a bare minimum improvement from -19 points to -18.
Perhaps the biggest news in the pairing this week will come on the same day with the BoE ‘Super Thursday’ of announcements; the BoE’s Minutes on their predicted rate freeze at 0.50% may provide some clue as to how soon next year the Monetary Policy Committee (MPC) is thinking of raising the interest rate, while the quarterly Inflation Report is sure to also provide a valuable future analysis of the state of the UK economy.