Safe-haven sentiment and inflation data support the Swiss franc; Swiss National Bank intervention expectations may limit gains
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Golden Ten Data reported on March 5 that the Swiss franc rose, supported by its safe-haven status, as the Middle East conflict triggered a new round of widespread risk aversion. Higher-than-expected Swiss inflation data on Wednesday also boosted the franc, reducing the likelihood that the Swiss National Bank will cut interest rates into negative territory. However, Michael Pfister of Commerzbank stated in a report that, given the Middle East conflict, the Swiss National Bank has indicated an increased willingness to intervene in the foreign exchange market, so the franc's gains may be limited. The next step is likely to be active intervention.
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