Swiss Franc Strengthens, Dollar Loses Safe Haven Premium
The Swiss franc strengthened to around 0.789 per USD on Wednesday (April 8), its highest level in more than two weeks, amid hopes of easing Middle East tensions after the US and Iran agreed to a two-week ceasefire. This development reduced demand for the dollar as a hedge, while Tehran's willingness to allow safe passage of ships through the Strait of Hormuz during the period helped ease concerns about energy-driven inflation.
Domestically, Swiss inflation reportedly surged in March to its fastest pace in a year, driven by rising heating oil costs amid an energy supply crisis. This data suggests that the inflation-suppressing effect of the strong franc on import prices is beginning to be offset by the boost in energy prices, thus easing pressure on the Swiss National Bank to quickly adjust policy.
Source: Newsmaker.id