USD/CHF slumps after SNB surprise

Ani Salama FXStreet

FXStreet (Córdoba) - USD/CHF lost more than 300 pips in a matter of minutes after the Swiss National Bank announced it will scrap the EUR/CHF floor and set a -0.75% rate for sight deposits.

The Swiss strengthened broadly following the measure and dragged USD/CHF from near 1.0200 to below 0.9900. The pair bottomed out at 0.9878 before bouncing and it is currently trading at the 0.9955 zone, recording a 2.25% loss on the day.

Meanwhile, EUR/CHF broke below 1.2000 for first time since 2011 when the bank introduced the measure, and it dropped as low as 0.9300.

The SNB said that in current circumstances, i.e. divergent monetary policies, euro weakness, enforcing and maintaining the minimum exchange rate for EUR/CHF is “no longer justified”.

Author

Ani Salama

FXStreet

Ani Salama is an Economist specialized in financial markets and statistics analysis. In 2010, she joined FXstreet where she now contributes with the news section.

EUR/USD remains bid, focus stays on 1.1900

EUR/USD has broken its two-day run of losses and is ticking modestly higher on Thursday, hovering around the 1.1880 area as the US Dollar struggles to find clear direction. Weekly Initial Jobless Claims rose more than expected, taking a bit of shine off the Greenback, but markets are largely in wait-and-see mode ahead of Friday’s US CPI release.

GBP/USD sticks to the bid bias, still below 1.3700

GBP/USD is trading with decent gains around 1.3650 on Thursday. Indeed, Cable is attempting to shake off the weakness seen earlier in the week amid another choppy session for the Greenback, while a run of disappointing UK data has so far failed to derail the pair’s tentative recovery.

Gold recedes slightly, trades below $5,100

Gold remains stuck in choppy trade on Thursday, deflating marginally just below the $5,100 mark per troy ounce as the US Dollar drifts without a clear trend. Softer US Treasury yields across the curve are offering some support, but with markets treading carefully ahead of Friday’s US CPI release, conviction remains limited and price action continues to look hesitant.