The Pound is surging higher versus the Swiss Franc on Wednesday, amid an improved mood in the market and despite UK coronavirus cases remaining high. The move northwards comes after three consecutive losing sessions.
At 11:15 UTC, GBP/CHF was trading +0.4% higher at 1.1970. This is towards the upper end of its daily traded range 1.1909 – 1.1986.
UK Inflation 1.5% YoY
The Pound is trending higher on Tuesday, clawing back losses from earlier in the week. Reports that British covid-19 vaccine trials will start tomorrow has helped lift the pound on Wednesday, overshadowing the latest coronavirus statistics. Coronavirus daily fatalities are back over 800, taking the total death toll past 17,000.
Data from the Office of National Statistics was also supportive of the pound. The ONS reported that UK inflation, as measured by the consumer price index, increased by 1.5% year on year. Whilst this was down from February’s 1.7%, it was in line with expectations. A sharp drop in the price of fuel and clothing items has driven the change in inflation.
Core inflation which, removes more volatile items such as food and fuel slipped to 1.6% in March, down from 1.7% the previous month. Meanwhile, other inflation measures revealed by the ONS surprised to the upside, lifting the Pound.
Looking ahead there is no more UK data investors will look ahead to the Government’s daily press conference for further clues over how and when the UK will ease out of lock down.
Swiss Franc Dips As Europe Re-opens
Demand for the safe haven Swiss France declined on Wednesday as risk sentiment improved. Equities across Europe headed higher and safe havens slipped.
The mood is upbeat as European countries start to slowly re-open their economies. Denmark announced that it will re-open primary schools from 4th May. Italy, the country with the highest coronavirus death toll in Europe, said that its exit strategy would be announced by the end of the week. Slowly as each country start to announce reopening strategies and implement them, economies are re-opening and risk appetite is improving.
There was no high impacting data today. Investors will look ahead to the release of economic sentiment data on Thursday.