GBP/CHF settles above 30 1/2-month low, posts 2% weekly gain

The GBP/CHF currency pair settled above recent low of 1.0609, its weakest level since September 29th 2022, after the latest inflation data out of the United Kingdom.

In the meantime, optimism surrounding the progress in trade negotiations between the United States, Japan and Italy prompted investors to pare flows into safe haven assets such as the Swiss Franc.

The Pound faced downward pressure this week following a softer-than-anticipated UK inflation reading.

Annual inflation rate in the UK has slowed to 2.6% in March from 2.8% in February, against market consensus and the BoE’s forecasts of 2.7%.

UK’s annual core CPI inflation, which excludes volatile categories such as food and energy, slowed to 3.4% in March, or the lowest rate since December, from 3.5%.

Easing inflationary pressure has added to expectations that the BoE might be inclined to adopt a more accommodative monetary policy stance, potentially including interest rate cuts in the future.

Meanwhile, media reports stated that the United States and Japan had been making considerable headway in their negotiations, particularly concerning the complex issues of tariffs and military spending. US President Donald Trump addressed this week’s meeting on trade with the Japanese delegation as “big progress.”

Also this week, Trump and ally Italian Prime Minister Giorgia Meloni expressed optimism over resolving the US-EU trade tensions.

The GBP/CHF currency pair settled 0.24% lower at 1.0840 on Friday.

The minor Forex pair gained 1.93% for the week.