By Areena FxThe US Dollar is trimming Wednesday gains on Thursday, pulling back to session lows near 0.7950. The generalised US Dollar weakness has offset the negative impact on the Swiss Franc from softer-than-expected inflation data.
Swiss consumer prices grew at a steady 0.2% year-on-year pace in September, against expectations of a moderate acceleration to 0.3%. Monthly inflation, on the contrary, accelerated its contraction to -0.2% from -0.1% in August.
These figures confirm the deflationary pressures of the Swiss economy, and keep pressure on the Swiss National Bank to cut interest rates into negative territory, a possibility that has been refused by the SNB President, Martin Schlegel.
The data, however, has a minor impact on the pair, which maintains a moderate bearish bias today, driven by the US Dollar’s weakness. The US government closure and the downbeat ADP employment report have bolstered hopes of further Fed rate cuts and are sending the US Dollar lower against its main peers today.