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The bloc’s single currency made an impressive rebound last week against the Swiss franc. The EURCHF pair failed to break past its support and has seen consecutive gains since it bounced back. Although the pair is gradually slowing down, it is still on a bullish path to reach its resistance as it enters the last month of the year. Unfortunately for the Swiss franc, the country’s economic growth forecasts for the year is projected to slow down to 0.8% from its previous forecasts of 1% growth in June. According to the Organization for Economic Cooperation and Development (OECD), this will remain well below Switzerland’s long-term average next year of 1.7%. The OECD said that the central bank’s relatively low interest rates are starting to contribute to the hazards in the country’s housing market. The Swiss National Bank has kept its negative interest rates at -0.75% for almost five years.
The Australian dollar to Canadian dollar pair is bound to hit its support as December approaches. The weakness of the Australian dollar came after the release of the Reserve Bank of Australia’s November meeting minutes, which showed that the bank came close to cutting its key interest rate. According to the RBA’s official minutes, the bank almost slashed its rates by 0.25 basis points, which would have then brought down the country’s interest rates to 0.5%. It was a close call as the policymakers of the Reserve Bank opted otherwise due to concerns about its effect on consumer confidence and savers. Although slashing interest rates could support the economy, the RBA observed the RBNZ’s previous rate cut wherein consumer confidence was affected. It is expected that the pair will only bounce off from its support and not break through it as the Canadian dollar is starting to show signs of exhaustion after disappointing economic forecasts.
As the cloud of uncertainty looms over the US dollar, the NZDUSD pair is bound to push to resistance due to trade war woes. The US dollar is on the defensive against the New Zealand dollar – who is taking advantage of the situation of the buck in sessions. Traders are experiencing jitters from the lack of directional hints regarding the US-China trade war negotiations, who are also holding back as they wait for further news that may give signs. Yesterday, US President Donald Trump and the US Federal Reserve Chief Jerome Powell discussed the economy. Trump mainly complained about the high interest rates of the US compared to its peers in the G10. Powell then explained, again, that the central bank’s policy decisions are not affected by political factors. Meanwhile, New Zealand’s third quarter PPI output went up past projections of -0.3% to 1% and its PPI input rose from 0.3% to 0.9%, giving support to the kiwi in sessions.
The British pound sterling jumps again against the Japanese yen in trading sessions. The ideal combination of fundamentals such as Brexit progress and the slowing appetite for safe-haven assets, the Japanese yen, in particular, is pulling the GBPJPY pair upward. Although some are suspecting that the pair won’t have sufficient power to move past resistance, still, the upward rally gives hope to pound bulls. The UK CBI industrial trend orders for November also gave support to the pound sterling. The CBI improved from last month’s -37% to -26% this November, beating expectations of only -31% improvement. Pound traders are becoming increasingly hopeful over the Conservative Party’s chances for victory in the December election of the UK. The odds of the Tory leadership in the upcoming election surged when Brexit Party head Nigel Farage announced that he will take down 43 extra candidates from the constituencies.