Swiss Franc Advances On Upbeat Trade Data; Eyes On SNB Meeting

(RTTNews) - The Swiss franc strengthened against other major currencies in the European session on Tuesday, after data showed that Switzerland's foreign trade surplus increased in August as exports rose faster than imports. Also, the markets await the Swiss National Bank's policy meeting to be held later in the week.

Data from the Federal Customs Administration showed that the nation's trade surplus rose to CHF 3.21 billion in August from CHF 2.55 billion in the previous month.

In real terms, exports rebounded 5.9 percent monthly in August versus a 4.9 percent decline in July. Similarly, imports logged a 1.5 percent gain in August, in contrast to a 1.8 percent gain in July.

In nominal terms, both exports and imports grew by 3.8 percent and 6.6 percent, respectively.

According to the Federation of the Swiss Watch Industry, watch exports rose 4.0 percent year-on-year in August. This development confirmed the normalisation of growth expected during the second half of the year.

Traders are eyed on the Swiss National Bank's policy meeting to be held on Thursday. The economists expect to raise interest rates by 25 basis points to 2 percent in the meeting.

Markets also wait for the interest rate decisions by the Federal Reserve, Bank of England, Bank of Japan as well as the Peoples Bank of China, due later in the week.

In the Asian trading today, the Swiss franc held steady against its major rivals.

In the European trading now, the Swiss franc rose to 4-day highs of 165.00 against the yen and 0.8947 against the U.S. dollar, from early lows of 164.45 and 0.8984, respectively. If the franc extends its uptrend, it could around 167.00 against the yen and 0.87 against the greenback.

Against the euro and the pound, the franc advanced to 0.9570 and 1.1086 from early lows of 0.9596 and 1.1122, respectively. The franc may test resistance near 0.94 against the euro and 1.09 against the pound.

Looking ahead, Canada inflation rate for August and U.S. building permits and housing starts data for August are slated for release in the New York session.