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Friday, June 21, 2024

CHF Falls Against The Dollar by 1% Following Balance of Trade

Switzerland’s Balance of Trade and GDP Growth Increase Slightly

The CHF has weakened against the dollar by 1% today, however, the Swiss economy saw some positive economic data. Switzerland’s balance of trade surplus increased more than expected in April.

The seasonally adjusted balance of trade surplus came in at 3.9 billion Swiss francs (CHF) in April, beating analyst estimates of 2.4 billion CHF. This was up from the revised 3.1 billion CHF surplus in March. The larger than expected surplus indicates stronger than anticipated foreign demand for Swiss goods.

Additional data from the Swiss Federal Statistical Office showed Switzerland’s GDP growth held steady in the first quarter of 2022. On an annual basis, GDP increased 0.6% year-on-year in Q1, in line with forecasts. Quarter-on-quarter, GDP growth accelerated to 0.5% in Q1 from 0.3% in the previous quarter, surpassing expectations of 0.3%.

Despite the positive economic data, the Swiss franc weakened slightly against the US dollar. The USD/CHF exchange rate rose 1.04% to 0.9615 as of writing. A weaker franc can help boost Switzerland’s export competitiveness but also risks fueling inflation if the currency depreciation is substantial.

USDCHF 1-Day

The data shows the Swiss economy continues to expand at a modest pace so far this year. However, the Swiss National Bank will be monitoring the franc exchange rate closely as a weaker currency could push inflation higher. The central bank may opt to intervene in currency markets or adjust interest rates if franc weakness threatens price stability in Switzerland. For now, inflation remains the key factor influencing the SNB’s policy outlook.

A weaker franc can help boost Switzerland’s export competitiveness but also risks fueling inflation if the currency depreciation is substantial.

The data shows the Swiss economy continues to expand at a modest pace so far this year. However, the SNB will be watching the Swiss franc rate closely as a weaker currency could push inflation higher. The central bank may opt to intervene in currency markets or adjust interest rates if franc weakness threatens price stability in Switzerland.

Lazarus
Lazarushttps://ljlnews.com
Publisher and editor of LJLNews. I am a Stock Market enthusiast, with an interest for politics. I hope you enjoy reading the articles! Contact me at: Lazaruslucas@ljlnews.com

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