Swiss Franc saw a surge after the release of the latest CPI data for February, which showed that inflation had accelerated beyond market expectations. The CPI remained above SNB’s target range of 0-2%, coming in at 3.4% yoy. This should reinforce the case for the SNB to maintain its tightening pace and raise interest rates by 50bps to 1.50% on March 23. While some analysts expect a slowdown to 25bps in June, SNB may continue to tighten at the current speed if inflation remains high.
USD/CHF’s break of 0.9340 support now suggests that corrective rebound from 0.9058 has completed at 0.9439 already, ahead of 38.2% retracement of 1.0146 to 0.9058 at 0.9474. Deeper decline would be seen to 0.9289 resistance turned support first. Decisive break there will bring retest of 0.9058 low.
EUR/CHF’s strong break of 4 hour 55 EMA now suggests that rebound from 0.9844 has completed. The corrective pattern from 1.0095 is now extending with another falling leg back towards 0.9844 support.