The GBP/CHF price continued its downward trend as investors assessed the latest economic data from the UK. The pair slipped to a low of 1.1475, which was the lowest point since March 2020. It has fallen by over 12.75% from its lowest level in March 2021.
UK economic data
The GBP to CHF exchange rate has been in a strong bearish trend as investors focus on the performance of the UK and Swiss economies. Data published this week sent mixed signals about the UK economy. On Tuesday, the numbers revealed that the labor market was starting to cool as the unemployment rate rose slightly.
On Wednesday, the UK published worrying consumer and producer inflation data. The headline CPI rose to a multi-decade high of 10.1%. Core CPI and PPI also rose sharply during the month. As a result, the Office of National Statistics published weak retail sales numbers on Friday. Therefore, there are concerns about what the Bank of Emgland to lower inflation without causing a recession.
The GBP/CHF price has also declined because of the surprising decision by the Swiss National Bank (SNB) to hike interest rates. The bank increased the main lending rate by 0.50% and analysts believe that it will deliver at least one more hike this year.
The GBP to CHF exchange rate has been in a strong downward trend in the past few weeks. The sell-off saw it drop below the important support level at 1.1527, which was the lowest level on July 21st. It then did a break and retest pattern by retesting that level.
It remains below the 25-day and 50-day moving averages while the awesome oscillator has moved below the neutral point. Therefore, the pair will likely continue falling as sellers target the next key support level at 1.3800. A move above the resistance level at 1.1.1430 will invalidate the bearish view.