USD/CHF Drops to Six-Week Low as Swiss GDP Surges
USD/CHF Drops to Six-Week Low Amid Robust Swiss GDP and Weaker Retail Sales, Lifting the Franc.
FUNDAMENTAL OVERVIEW:
The Swiss Franc (CHF) extended its advance against the US Dollar (USD) for a third consecutive session on Monday, opening the week with solid momentum amid a broadly weaker USD and a risk-averse global backdrop that favoured safe-haven flows.
At the time of writing, USD/CHF is down nearly 0.70% intraday, hovering near 0.8178 during the European session—its lowest level since April 21 and firmly below last week’s trough. The move follows the release of stronger-than-expected Swiss first-quarter GDP data and softer Retail Sales, further enhancing the Franc’s appeal.
Monday’s data showed that Switzerland’s economy expanded by 0.5% quarter-over-quarter, up from a revised 0.3% and surpassing expectations of 0.4%. On an annual basis, GDP rose 2.0%, outpacing the previous 1.6% and well above the forecast of 1.5%. The upside surprise was largely attributed to a surge in exports, as Swiss firms accelerated shipments to the US ahead of anticipated tariff hikes.
The robust economic expansion was further supported by strong manufacturing growth, which rose 2.1% in Q1 following a 1.2% gain in Q4. The construction sector also bounced back, registering a 1.1% increase after stagnation in the previous quarter. Additionally, activity in trade, motor vehicle, and motorcycle repairs surged by 2.1%, up markedly from just 0.3% in Q4—signalling broad-based growth across key industries.
On the consumer side, Swiss Retail Sales rose 1.3% year-over-year in April, down from a 2.2% increase in March and missing forecasts for a 2.5% rise. The softer reading hints at a more cautious consumer outlook, despite the economy’s overall resilience.
Looking ahead, market focus will shift to the upcoming US ISM Manufacturing PMI and a speech from Federal Reserve Chair Jerome Powell later today—both potential drivers for USD volatility. In Switzerland, attention will turn to fresh inflation data due Tuesday, which may further influence Swiss Franc dynamics.
USD/CHF TECHNICAL ANALYSIS CHART:
Technical Overview:
USD/CHF is trading within a down channel.
USD/CHF is moving below all the Moving Averages (SMA).
The Relative Strength Index (RSI) is in the Selling Zone, while the Stochastic oscillator suggests a Negative trend.
Immediate Resistance level: 0.8248
Immediate support level: 0.8157
HOW TO TRADE USD/CHF
On the higher time frame, USD/CHF initially experienced a sharp decline, followed by a strong rebound as buyers pushed the price higher. However, the upside momentum was short-lived, and the pair quickly reversed back to the downside with increased selling pressure. Currently, USD/CHF has broken below a key support level and is now retesting that zone. If the pair faces renewed rejection at this level, it could signal a continuation of the bearish trend and further downside movement.
