The Pound has found some support over the past week, gaining almost two cents on the CHF at its high.
GBP/CHF exchange rates are continuing to float around 1.25, following positive comments made last week by Bank of England (BoE) governor Mark Carney.
Carney alluded to a prospective interest rate hike over the coming months, although with no timeline given on the prospective height, are we witnessing something of a false dawn for Sterling?
The Franc has found support under 1.25, despite worse than expected inflation data released this morning and the markets focus will now switch to tomorrow, with a host of key economic data released for the UK.
At 09.30 the latest Manufacturing & Industrial Production figures are released, alongside Trade Balance data. With an improvement on last month being anticipated by investors, it will be interesting to see whether any positive news has been factored into Sterling’s current value.
Trade Balance figures, which indicates how much we spend on imports compared to the money we make on exports, is a key barometer for any economy. This will be monitored even closer the coming months as the UK separates itself from the EU and will be used to gauge how trade deals are faring.
However, it will be the latest NIESR Gross Domestic Product (GDP) estimate alongside Carney’s speech, which could shape GBP/CHF rates for the subsequent days.
Any further bullish comments regarding future rate hikes, or a positive reading from NIESR could help Sterling break the 1.25 levels against the CHF.
Similarly, any negative reading or diluted comments by Carney could push the pound back down and the recent gains could be eliminated extremely quickly.
The current market remains extremely volatile and unpredictable, which is why I have been advocating that my clients take advantage of any short-term gains and protect their positions where possible.
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