Swiss franc Fundamental Analysis February 23, 2015 – Forecast – USDCHF & EURCHF

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Published: Feb 20, 2015, 12:48 GMT+00:00

Analysis and Recommendations: The USD/CHF and the EUR/CHF diverged today as the dollar gained momentum and the euro tumbled but the Swissy remained fairly

Swiss franc Fundamental Analysis February 23, 2015 – Forecast – USDCHF & EURCHF

Analysis and Recommendations:

The USD/CHF and the EUR/CHF diverged today as the dollar gained momentum and the euro tumbled but the Swissy remained fairly stable as the focus in the market was on the Greek extension and there meeting of the Eurogroup. The franc was trading at 1.0774 near its highest level against the euro and at 0.9518 against the stronger US dollar. Fiscal policy, political independence, innovation and flexibility have all helped strengthen the Swiss economy in the face of challenges, said Thomas Jordan, chairman of the Swiss National Bank (SNB), at the Free University of Brussels.

In a speech titled “Switzerland at the heart of Europe: between independence and interdependence”, Jordan highlighted the features that have helped the country survive periods of economic crisis.

Around the world, central banks’ balance sheets are becoming an increasingly serious concern – most notably for monetary policymakers themselves.

When the Swiss National Bank (SNB) abandoned its exchange-rate peg last month, causing the franc to soar by a nosebleed-inducing 20%, it seemed to be acting out of fear that it would suffer balance-sheet losses if it kept purchasing euros and other foreign currencies.

Similarly, critics of the decision to embark on quantitative easing in the Eurozone worry that the European Central Bank is dangerously exposed to losses on the southern Eurozone members’ government bonds. This prompted the ECB Council to leave 80% of those bond purchases on the balance sheets of national central banks, where they will be the responsibility of national governments.

FxEmpire provides in-depth analysis for each currency and commodity we review. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more up to the data analysis and information in our weekly reports.

Today’s economic releases actual vs. forecast:

Cur.		Event	Actual	Forecast	Previous
	Holiday	China – Lunar New Year
EUR		German PPI (MoM)	-0.6%	-0.4%	-0.7%
EUR		German Mfg. PMI	50.9	51.5	50.9
EUR		German Services PMI	55.5	54.2	54.0
EUR		Manufacturing PMI	51.1	51.5	51.0
EUR		Markit Composite PMI	53.5	53.0	52.6
EUR		Services PMI (Feb)	53.9	53.0	52.7
GBP		Core Retail Sales	-0.7%	-0.1%	-0.1%
GBP		Retail Sales (MoM)	-0.3%	-0.2%	0.2%

Upcoming Economic Events that you should be monitoring:

Monday, February 23^rd

Cur.		Event	Actual	Forecast	Previous
	Holiday	China – Lunar New Year
EUR		German Business		103.0	102.0
EUR		German Current		112.7	111.7
EUR		German Ifo Business		107.7	106.7
USD		Existing Home Sales		5.03M	5.04M
USD		Existing Home Sales			2.4%