By Samir Al Khoury,

The price of the US dollar against the Swiss franc fell by about 1% yesterday, recording 0.9031 and is currently hovering near the 0.9050 levels. However, it is still up by about 8% since the beginning of the year until today.

Recent Swiss economic data show that the Swiss economy is truly resilient, as:

• The GDP index rose on a quarterly basis, registering a growth of 0.5%, a rate that exceeded expectations and the previous reading of 0.3%, marking its highest level in two years.

• The trade balance rose to 4.316 billion Swiss francs, surpassing expectations of 3.980 billion and the previous reading of 3.767 billion.

• Retail sales increased on an annual basis, registering a growth of 2.7%, which exceeded expectations of 0.2% and the previous reading of -0.2%.

The consumer price index rose on an annual basis in Switzerland, recording 1.4% in April, a rate that exceeded expectations of 1.1% and the previous reading of 1.0%. This indicates the possibility of the Swiss Central Bank maintaining interest rates at their current level of 1.50% at its meeting on June 20, 2024, after reducing them by 25 basis points at its meeting on March 21, 2024. Notably, the Swiss Central Bank was the first to start reducing interest rates this year.

Today, analysts are closely awaiting the release of the core personal consumption expenditures price index in the United States, which is a crucial indicator favored by the US Federal Reserve. They are also anticipating the release of the consumer price index in Switzerland next week, specifically on Tuesday, June 4, 2024.

From a technical perspective, if the pivot point of 0.9068 for the US dollar against the Swiss franc is broken, it could target the support levels of 0.8993, 0.8956, and 0.8881. If it exceeds the pivot point, it is likely to target the resistance levels of 0.9105, 0.9180, and 0.9218. The Relative Strength Index (RSI), currently at 44 points, indicates negative momentum for the USD/CHF pair.

Please note that this analysis is provided for informational purposes only and should not be considered as investment advice.

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