Sterling has come under some pressure recently, falling by over two cents against the CHF since the middle of June.
GBP/CHF rates are currently trading around 1.3065, having hit a high of 1.3271 earlier this month.
The Franc has been supported by robust growth in the Swiss economy, which grew at a faster pace during the first quarter of this year than analysts expected.
A weaker CHF and global sporting events helped to boost the Swiss based International Olympic Committee & football’s governing body FIFA. This in turn has led to increased support for the CHF, which is also likely to have benefited from the current uncertainty surrounding the global trade markets.
In times of global uncertainty investors will move funds back into the CHF, which has always been considered a “safe haven” currency by investors.
However, the Swiss National bank (SNB) may be concerned about the recent increase in value for the CHF, which they already felt was over-valued. This in turn is restricting an increase in their exports, due to the increased price of goods & services. It will be interesting to note if and how the SNB react to this recent spike but either way it is likely that the Pound will find plenty of support around 1.30, despite the current uncertainty facing the UK economy due to Brexit.
Fears over the current state of the UK economy have continued to manifest themselves over recent weeks, in line with the greatest signs of stress shown since the Eurozone economy and double-dip recession six years ago.
The Pound in turn has struggling to sustain any increase in its value against the CHF, as proved by its recent dip. The current malaise facing the UK economy is unlikely to help facilitate any aggressive increase for Sterling over the coming days.
With Brexit talks becoming more clouded and a seemingly divisive split in the UK government, the Pound is likely to find life tough going in the short-term. For more information on the outlook for the Pound against the Swiss Franc, you can reach me on firstname.lastname@example.org.