Negative Market Sentiment Allows Swiss Franc Ignore Economic Data

The Swiss franc gained today, getting boost from risk aversion on the Forex market. The currency gained even as domestic macroeconomic reports were extremely disappointing, demonstrating weakness of the Swiss economy.
Switzerland’s State Secretariat for Economic Affairs reported that gross domestic product rose 0.2% in the fourth quarter of 2018, trailing the consensus forecast of a 0.4% increase. The increase followed the 0.3% drop in the previous quarter. The report explained that manufacturing was the reason for the growth:

Manufacturing saw dynamic growth. Concurrently, exports of goods increased significantly. In contrast, domestic demand stagnated.

The KOF Economic Barometer added to evidences of economic downturn, posting a decline from 96.2 in January to 92.4 in February. The actual figure was far below the forecast level of 95.2. The report commented on the result:

The recent downward tendency thus continued unabated. Accordingly, the Swiss economy can expect to experience a weak phase in the coming months.

Contrary to the GDP report, the KOF Barometer signaled about weakness in the manufacturing sector:

The marked decline is predominantly due to negative impulses from the manufacturing industry; but the deteriorating sentiment has meanwhile also extended to the other components of this barometer.

USD/CHF traded at 0.9981 as of 21:13 GMT today after opening at 1.0013 and falling to the daily low of 0.9926. EUR/CHF dropped from 1.1384 to 1.1351, touching the low of 1.1330 intraday. CHF/JPY jumped from 110.79 to 111.65.

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