Pound Swiss Franc (GBP/CHF) Dips, Swiss Retail Sales Rise in October

GBP/CHF Exchange Rate Eases, Swiss Franc Boosted by Safe-Haven Status

The Pound Swiss Franc (GBP/CHF) exchange rate dipped today, with the pairing currently trading around 1.290Fr after Switzerland’s year-on-year real retail sales for October rose by 0.7%, improving confidence in the Swiss economy ahead of Christmas.

The safe-haven Swiss Franc (CHF) has also continued to benefit against the Pound (GBP) due to continued uncertainty around a US-China trade deal this year, with talks between Beijing and Washington having ‘stalled because of Hong Kong legislation’, according to the news website Axios.

This follows US President Donald Trump’s signing into law a Hong Kong bill which aims to protect Hong Kong protestors, a move which has been heavily criticised by Beijing as the US intentionally meddling in Chinese affairs.

As markets await further developments between the world’s two largest economies, the CHF/GBP remains bolstered by the Swiss Franc’s safe-haven amid growing global economic and political concerns.

GBP/CHF Exchange Rate Eases as UK Manufacturing PMI Remains in Contraction Territory

The Pound (GBP) fell against the Swiss Franc (CHF) today after November’s UK Markit manufacturing PMI dropped to 48.9, which weighed on market confidence in the British economy.

Duncan Brock, Group Director at the Chartered Institute of Procurement and Supply, was also downbeat in his analysis, commenting:

‘A heavy sense of inevitability hung around the sector in November as it continued to suffer the effects of a lethal cocktail of Brexit uncertainty, slowing global growth and an impending General Election. These combined to stifle any chance of manufacturing crawling out of the contraction zone, where the sector was stuck for a seventh month in a row.’

UK political developments continue to remain in focus today, with Prime Minister Boris Johnson’s reluctance to face an interview with BBC’s Andrew Neil causing some concern for GBP investors ahead of the 12th December general election.

With investors generally favouring the Conservative Party, any slippage in the opinion polls ahead of the election would prove Pound-negative.

GBP/CHF Outlook: Could Sterling Sink on Fears of a Hung Parliament?

Pound (GBP) investors will be looking ahead to tomorrow’s publication of November’s BRC Like-For-Like retail sales figures, which are expected to fall from 0.1% to -1.7%, potentially weakening the GBP/CHF exchange rate.

Swiss Franc (CHF) traders, meanwhile, will be paying close attention to tomorrow’s release of Switzerland’s inflation figure for November, with any signs of decreasing likely weakening investor confidence in CHF.

The GBP/CHF exchange rate will continue to be driven by political developments ahead of the general election this month, with any signs of the Tories losing some of their lead in the opinion polls likely weakening the Pound on rising fears of a hung Parliament on the 12th December.

David Moore

Contact David Moore


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