ALTHOUGH the situation in Greece has put enormous pressure on the euro, the Swiss franc has held remarkably firm above the SFr1.4320 level over the past month when you might have expected euro-Swiss franc to fall even further. The Swiss National Bank has been supporting the franc at around SFr1.4325 in a bid to prevent it from rallying further against the euro. As the Eurozone crisis rumbles on, it will be interesting to see how much longer the SNB can hold out. Spread Co offers a spot rate of SFr1.4324-SFr1.4329.
Weakness in the euro could be good news for the pound though, and we could see a break lower for euro-sterling. The pair is currently hovering just above the nine-month low of £0.86 mark but a move below here could open up a test of £0.85. Capital Spreads quotes £0.8615-£0.8618.
The Aussie dollar had been eyeing a break higher against the Japanese yen, but even news of another rate hike from the Reserve Bank of Australia has been insufficient to sustain the upward momentum.
Aussie dollar-yen found itself sold off heavily yesterday as concerns over sovereign debt in Europe – aside from Greece – resurfaced and traders have elected to take profits as a result. A break below April lows of ¥84 would pave the way for more selling but this pair still looks like an attractive carry trade. The current IG Index price is ¥86.32-¥86.36.
The Aussie dollar is also sliding back against the US dollar. This week’s rise in interest rates did see the Aussie dollar spike higher. However, the current weakness in commodity prices on the back of tighter Chinese monetary policy and the miners’ “super tax” has seen the currency fall back. Traders could look to sell into rallies towards US$0.9250 for a move towards US$0.9000. CMC Markets is offering a spread of US$0.9160-US$0.9162 on Aussie-US dollar.