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Swiss Franc Valuation Nation

Presented by Maggie O’Connell, Colleen Traeger, David Terschluse, and Sean McConnell, this analysis explores the current valuation of the Swiss Franc (CHF) amid significant economic indicators. With a GDP of $250 billion (289.75B CHF) and a projected growth rate of 2.1% for 2005, the country maintains a robust fiscal situation, supported by a current account surplus. The analysis discusses trends in inflation, foreign investments, and the CHF's resistance levels against the US dollar, providing insights on potential future movements and strategic analyses from prominent forex strategists.

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Swiss Franc Valuation Nation

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  1. Swiss Franc Valuation Nation Presented By: Maggie O’Connell Colleen Traeger David Terschluse Sean McConnell

  2. And we are not John Stiver

  3. Current GDP at $250 billion (289.75B CHF) Recent GDP growth followed ’01-’03 recession Predicted 2.1% growth for ’05 Net assets exceed GDP at 135% Economic Growth

  4. Money Growth and Trade • Imposed ceiling on inflation at 2% • Predicted ’05 inflation growth – 0.8% • Large Current Account and trade surpluses • Fiscal account deficit of 2.5% in ’04 due to significant influx of investment • Economy holds about 35% of world’s offshore funds

  5. CHF Facts • Managed floating fiat currency, backed by gold and other currency holdings • Most stable by reputation • Unlikely EU member • Significant appreciation during US ’70s-’80s inflation, depreciation during ’90s • Appreciation, along with Euro, ever since 9/11/01

  6. Technical Analysis* Resistance Main Trendline Support Resistance Channel Line New Main Trendline? *Swiss Franc per US $ Support • Since September 2004, the Franc has appreciated in value relative to the dollar • Most recent breakthrough of main trendline shows continued appreciation

  7. Cheese Anyone?

  8. Our Cheesy Predictions • Modest appreciation • Mitigation of appreciation with low interest rates • Possible peak and change of trend • Possible depreciation due to overvaluation of CHF according to PPP

  9. Analyst Comments • Previous bottom and the Fibonacci support may give another upward movement from 1.1620-60 range. – Rahul Chandra, Forex strategist • USD/CHF is in a downtrend directed by 1H exponential moving averages. Volatility is low. Bollinger bands are parallel and form the trend. Should continue to1.1750.– Arnaud Jeulin, Mataf.net strategist • Price dipped marginally bellow our support, and given the bullish divergences we feel there is good case for the resumption of upside.– Iam Copsey, FX-Strategy currency strategist

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