The Swiss franc drifted lower against its major rivals in European deals on Monday, as European shares advanced, and data showed that sight deposits at the Swiss National Bank increased last week, in a sign of possible intervention.
Data from the SNB showed that domestic sight deposits increased to CHF 406.13 billion in the week ended December 18, from CHF 401.4 billion a week earlier.
European markets were trading higher despite split verdict in the Spanish elections.
Neither the Prime Minister Mariano Rajoy’s conservatives nor left-wing won a clear majority in Spanish elections on Sunday.
Rajoy’s Popular Party secured just 123 seats in the 350-seat national parliament, opening the door for negotiations to form a coalition government.
The franc showed mixed trading against its major rivals in Asian deals. While the franc held steady against the euro and the greenback, it rose against the yen. Against the pound, it declined.
In European trading, the Swiss franc fell to a 4-day low of 1.0819 against the euro, from an early high of 1.0771. The next possible support for the franc may be located around the 1.10 mark.
Data from Destatis showed that Germany’s producer prices declined at a faster-than-expected pace in November.
The producer price index fell 2.5 percent year-over-year in November, which was worse than the 2.3 percent drop in the prior month.
The franc edged down to 1.4852 versus the pound, 0.9969 against the greenback and 121.77 against the yen, reversing from its prior highs of 1.4773, 0.9907 and 122.53, respectively. If the Swiss franc extends its downtrend, it is likely to find support around 1.50 against the pound, 1.02 against the greenback and 125.00 against the yen.
Looking ahead, Eurozone consumer sentiment index for December is slated for release at 10:00 am ET.
The material has been provided by InstaForex Company – www.instaforex.com