Swiss Franc Slides Amid Risk-on Mood

(RTTNews) - The Swiss franc weakened against other major currencies in the European session on Tuesday, as investors await key U.S. economic data for direction.

Trading later in the day may be impacted by reaction to readings on U.S. retail sales, pending home sales, producer prices and consumer confidence.

Ahead of Thanksgiving and Black Friday, these reports may provide valuable insights into inflation pressures, consumer spending patterns and overall economic sentiment in the world's largest economy.

The investor sentiment was also driven by strength in the artificial intelligence trade and renewed hopes of a Federal Reserve interest rate cut.

According to the CME FedWatch Tool, markets currently price in a more than 80 percent chance of a quarter percentage point cut from the U.S. central bank in December.

The optimism around the US-Swiss trade deal was overshadowed by the recent data, which revealed that Switzerland's export-oriented economy shrank in the third quarter for the first time in more than two years.

Aside from this, the safe-haven Swiss Franc's (CHF) relative underperformance is a result of a generally bullish sentiment around the equities markets.

Additionally, the CHF may be capped due to predictions that the Swiss National Bank (SNB) would maintain its policy rate at zero percent in December.

In the European trading today, the Swiss franc fell to more than a 1-1/2-month low of 0.9339 against the euro, more than a 1-month low of 1.0633 against the pound and more than a 1-week low of 192.97 against the yen, from early highs of 0.9312, 1.0593 and 194.13, respectively. If the franc extends its downtrend, it is likely to find support around 0.94 against the euro, 1.07 against the pound and 187.00 against the yen

Against the U.S. dollar, the franc edged down to 0.8099 from an early high of 0.8080. The franc may test support near the 0.81 region.

Looking ahead, Canada wholesale sales data for October, U.S. ADP employment data, PPI for September, retail sales data for September, U.S. S&P/Case-Shiller home price index for September, U.S. business inventories for August, U.S. Consumer Board's consumer confidence for November, U.S. pending home sales for October, U.S. Richmond Fed manufacturing index for November and U.S. Dallas Fed services index for November, are slated for release in the New York session.