CAD/CHF eases from 2-week high with BoC decision in focus

The CAD/CHF currency pair pulled back from a two-week peak of 0.6322, while holding below the 0.6300 mark on Tuesday, after Swiss macro data and ahead of the outcome of the Bank of Canada’s policy meeting.

The Bank of Canada is expected to lower its benchmark interest rate by 25 basis points to 4.25% at its September policy meeting. This would extend the BoC’s rate cuts from the prior two meetings.

BoC policy makers had noted that inflation slowed in recent months, while the labor market showed signs of moderation.

Meanwhile, data out of Switzerland showed the economy had registered the fastest quarterly expansion since the second quarter of 2022, while annual CPI inflation had eased to its lowest level since March in August.

Switzerland’s GDP expanded 0.7% quarter-on-quarter in Q2, while outpacing market consensus of 0.5% growth, underpinned by a 2.6% surge in the manufacturing industry.

The country’s headline inflation decelerated to 1.1% in August from 1.3% in the prior two months, while the annual core inflation rate remained stable at 1.1% in August.

As of 12:50 GMT on Tuesday the CAD/CHF currency pair was edging down 0.23% to trade at 0.6286.