EUR CHF exchange rate with strongest growth since mid-2017

EUR Keeps Gaining

                On Friday morning the euro rose by 0.3% versus USD, as well as rallied in the exchange rate against the Swiss franc. It hit the highest price since beginning of January versus CHF. It was another day of gains for single currency, after it had recorded eight days of gains against USD, the longest winning streak in more than 9 years. If for another couple of days, it posts gains, the winning streak can be the best since 2004. On Thursday EUR recorded a 12-week high, gaining 1.04% to $1.1361. When it comes to the exchange rate EUR/CHF, euro has the best weak since mid-2017.

PEPP Increased

                The reason for the high EUR exchange rate on Thursday and Friday was mainly the European Central Bank’s decision to pump up its Pandemic Emergency Purchase Program to 1.35 trillion euros from 750 billion euros. Analysts had expected a raise of 500 billion euro, so ECB beat expectations. The PEPP programme was extended until June 2021 the earliest, but proceeds will be reinvested until at least the end of 2022. The news of the extension of the PEPP arrived just after German fiscal stimulus aid was announced and the European Union proposal of the recovery fund. All of these are aimed at helping economy and businesses hurt by the pandemic lockdown and make investors more hopeful. Additionally, the ECB lowered 10-year Italian bond yield spread to Germany by 20 basic points. Recently, German and US bonds, both considered as safe investments, are selling off. Yields of 10-year US bonds are 0.8% above two-month high. Actions taken by the ECB can help the euro zone recover quicker from the COVID-19 recession than UK or US, according to experts.

USD Records Losses

                Meanwhile, the US dollar exchange rate was not in good shape, as it headed on Friday for the third straight week of losses. Its index measuring performance against other six currencies was at 96.808, close to the lowest point in almost three months. A day before it went down by 0.67% to 97.675. The weak price of USD triggered higher exchange rates of not only euro, but also British pound, as well as Australian and New Zealand dollars that both have increased by 4% this week. The USD price declines due to the improving risk sentiment among investors, that now are eager to sell safe haven currencies like USD and also decide more often to sell Swiss francs, which explains rising price of EUR in EUR/CHF exchange rate. Investors are hopeful now that the worst COVID-19 peak has passed, which is also reflected in better situation on stock markets. On Thursday, the number of filings for the unemployment benefits in the USA dropped below 2 million for the first time since middle of March, though still it is extremely high.