Last week in Forex News the Swiss franc advanced to a two-week high against the U.S. dollar, as escalating concerns over unrest in the Middle East boosted refuge demand for the cash.
USD/CHF hit 0.9438 on Friday, the pairs lowest since February 3; the pair subsequently consolidated at 0.9441 by close of trade on Friday, tumbling 3.06% over the week.
The pair is likely to find support at 0.9327, the low of February 2 and a one-month low and resistance at 0.9601, last Thursday’s high. Worry over a possible confrontation between Israel and Iran, with Iranian warships reported to be on their way to the Suez Canal, boosted demand for the franc while investors shunned the dollar, sometimes viewed as a safe haven, because of the U.S.'s strong ties to Israel. The Swiss franc was also lifted after the president of the Swiss National Bank, Philipp Hildebrand, said that with inflation moving higher, interest rates could not remain at ultra-low rates forever and would have to normalise. He added that there was no miracle solution to rein in Swiss franc strength and that it could help in containing inflationary pressures. Next week, the biggest focus will be the release on Friday of preliminary data on fourth quarter U.S. gross domestic product.
