USD/CHF stalls decline near 0.9915 on disappointing Swiss GDP

• The CHF rally stalls as the Swiss economy contracts in third quarter.
• Broad USD weakness combined with risk-off keep USD/CHF vulnerable.

The USD/CHF pair found fresh buyers near 0.9915 in early Europe, as the Swiss franc ran through fresh offers after the Swiss economy unexpectedly contracted in the third quarter, coming in at -0.2% q/q vs. +0.4% expected and +0.7% last.

Despite the latest uptick to 0.9930 levels, the spot remains undermined amid ongoing broad-based US dollar weakness and re-emergence of the risk-off trades, as the focus shifts towards the US-China trade tensions heading into the Trump-Xi meeting scheduled tomorrow. The demand for the safe-haven Swiss franc tends to rise, as markets flock to safety in a bid to protect their capital.

Meanwhile, the US dollar could witness further weakness should the minutes of the Nov FOMC meeting show that the Fed remains cautious on further rate hike prospects while reiterating the dovish view delivered by the Fed Chair Powell a day before. In the meantime, the pair will continue to get influenced by the broader markets sentiment and USD-dynamics, as markets await the US macro updates for further momentum.

USD/CHF Technical Levels