News Column

Swiss Franc Rises Amid Risk Aversion

July 7, 2014

BRUSSELS (Alliance News) - The Swiss franc rose against most major currencies in European deals on Monday on safe-haven status, as European stocks declined after weak data on German industrial production for May.

German industrial production declined unexpectedly in May and at the sharpest pace since April 2012 as geopolitical risks weighed on business confidence and demand.

Industrial output fell 1.8% in May from the prior month, Destatis reported. This was the third consecutive fall and the biggest since April 2012, when output dropped by 2%.

International Monetary Fund Managing Director Christine Lagarde indicated a slight reduction to the institution's global growth outlook as investment remains subdued.

The global economic outlook to be released later this month would be "slightly different" from previous forecasts, Lagarde said at the Cercle des Economists conference in Aix-en-Provence, France on Sunday.

In economic news, Switzerland jobless rate remained unchanged in June as widely expected by economists, official data revealed.

The seasonally adjusted unemployment rate came in at 3.2% in June, the same rate as seen in May, the State Secretariat for Economic Affairs said.

Meanwhile, the jobless rate, on an unadjusted basis, fell to 2.9% from 3% in May.

The franc was trading higher at 1.2154 against the euro and 0.8937 against the greenback, after falling to a 4-day low of 1.2164 and a 2-week low of 0.8958, respectively in early deals. On the upside, the franc may find resistance around 1.21 versus the euro and 0.885 against the greenback.

The franc bounced off from early near 2-year low of 1.5366 against the pound and rose to 1.5322. The pair finished Friday's trading at 1.5340. If the franc extends its ascending trend, 1.52 is seen as its next possible resistance level.

Meanwhile, the franc held steady against the yen with pair trading at 114.01, after slipping to a weekly low of 113.94 in prior dea1s. The franc-yen pair finished trading at 114.11 last week.

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Source: Alliance News

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