The Pound Sterling to Swiss Franc (GBP/CHF) exchange rate rallied by around 0.97% on Tuesday afternoon.
Tuesday’s British economic data showed sales had stagnated despite low oil prices giving consumers more room to spend. The data, however, had minimal impact on the Pound with traders expecting Eurozone quantitative easing to aid the UK’s economic growth.
The Swiss Franc, meanwhile, softened versus most of its major peers after unemployment rose. Additional losses can be attributed to the Swiss National Bank (SNB) flirting with the idea of cutting the cash rate from -0.75% to -1.5%.
The Pound Sterling to Swiss Franc (GBP/CHF) exchange rate is currently trending in the region of 1.5057.
Pound Sterling (GBP) Exchange Rate Gains despite Below-Forecast Sales Data
BRC Like-For-Like Sales registered growth of 0.2% in February on the year, missing estimates of 0.5% but equalling the previous figure. The data was surprising to many experts who speculated that low oil prices would promote increased consumption.
‘It’s surprising more consumers aren’t treating themselves to a new pair of shoes, or curtains for the home,’ said David McCorquodale, at survey sponsor KPMG, in a statement. ‘One suspects that restaurateurs, not retailers, are benefiting from the extra cash in consumers’ pockets resulting from fuel price savings.’
The Sterling appreciation has been linked to the positive effect of Eurozone quantitative easing on the British economy. As the Eurozone’s largest trading partner, the UK will hope to benefit from a softer shared currency.
The Pound Sterling to Swiss Franc (GBP/CHF) exchange rate has fallen to a low of 1.4886 today.
Swiss Franc (CHF) Exchange Rate Dives as Unemployment Rises
The seasonally-adjusted Swiss Unemployment Rate came in at 3.2% in February, gaining on the 3.1% registered previously. February’s Non-Seasonally-Adjusted Unemployment Rate equalled the previous figure of 3.5%.
Adding the ‘Swissie’ (CHF) declination was news from the SNB that the negative interest rate has room to fall further if necessary. Citing sources close to the SNB, Schweiz am Sonntag said ‘a rate of minus 1.5 percent is being considered.’
‘There’s clearly a limit to the negative rate – the question is exactly where it is,’ SNB President Thomas Jordan told Swiss radio SRF in an interview broadcast Saturday. ‘At the current level of minus 75 basis points, the limit surely isn’t reached.’
Pound Sterling to Swiss Franc (GBP/CHF) Exchange Rate Forecast to Hold Gains
Given the lack of data to curb the trend, the Pound Sterling to Swiss Franc (GBP/CHF) exchange rate is likely to hold gains for the rest of Tuesday’s trade. There is the potential for heightened GBP/CHF volatility on Wednesday with British Industrial and Manufacturing Production data due for publication.
The Pound Sterling to Swiss Franc (GBP/CHF) exchange rate climbed to a high of 1.5079 today.
