CHF vs Yen (FX:CHFJPY)
From Feb 2020 to May 2020
The Swiss franc showed mixed trading against its major counterparts in the European session on Thursday, after the Swiss National Bank retained its interest rates and raised its negative interest exemption threshold, as coronavirus is posing exceptionally large challenges to the economy.
The SNB decided to hold its policy rate and interest on sight deposits at the SNB at -0.75 percent.
The bank said the Swiss franc is even more highly valued. Negative interest and interventions are necessary to reduce the attractiveness of Swiss franc investments and thus counteract the upward pressure on the currency.
The SNB will take additional steps to ensure liquidity as necessary. The central bank is providing liquidity as part of the extended swap arrangements with other major central banks, particularly in US dollars.
The central bank said it is raising the exemption threshold as of April 1, 2020, thus reducing the negative interest burden on the banking system. The threshold factor will increase to 30 from 25.
Data from the Federal Customs Administration showed that Switzerland's exports declined in February after rising in the previous month, and imports decreased for second month.
Exports decreased by a real 3.3 percent month-on-month in February, while imports fell 0.1 percent.
The franc declined to a 3-week low of 0.9754 against the greenback and held steady thereafter. Immediate support for the franc is seen around the 0.99 level.
The Swiss currency pulled back to 111.87 against the yen, from a 3-day high of 113.02 set at 12:15 am ET. The franc is likely to challenge support around the 110.00 region, if it drops again.
Data from the ministry of Internal Affairs and Communications showed that overall nationwide consumer prices in Japan were up 0.4 percent on year in February.
That was shy of expectations for an increase of 0.5 percent and was down from 0.7 percent in January.
The franc retreated to 1.1242 against the pound, after rising to a record high of 1.1114 at 11:30 pm ET. The next possible support for the franc is located around the 1.25 level.
Following a 2-day drop to 1.0602 at 8:30 pm ET, the franc rebounded to 1.0546 against the euro. If the franc rises further, it may find resistance around the 1.03 level.
Looking ahead, the U.S. weekly jobless claims for the week ended March 14 and leading index for February will be featured in the New York session.