Swiss Franc pares losses following a steady Swiss trade surplus in April

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The Swiss Franc (CHF) is picking up against the US Dollar on Tuesday, trimming Monday’s losses amid a moderate improvement in market sentiment and steady Swiss Trade Balance figures. The USD/CHF pair trades at the 0.7850 area at the time of writing, down from 0.7884 highs in the previous day.

The USD/CHF retreats to 0.7850 on Tuesday from 0.7886 highs on Monday.
Swiss trade surplus remained steady in April, as a decline in exports was offset by lower imports.
News of a ceasefire in Lebanon has lifted the market sentiment and is weighing on the safe-haven US Dollar.

Data from the Swiss Federal Statistics Office released on Tuesday showed that the country’s trade surplus edged up to CHF 3,098 million in April, up from CHF 3,092 million in March. According to the report, the April decline in exports has been offset by a similar drop in imports.

These figures follow a stronger-than-expected performance of the Swiss economy in Q1, as measured by the Gross Domestic Product (GDP) report released on Monday, which was accompanied by solid Retail Sales and business activity figures.

Beyond that, the US Dollar is showing a mild bearish tone on Tuesday, as investors welcome reports of a ceasefire between Israel and Hezbollah in Lebanon. Markets are hopeful that this truce will help to unravel the stalemate in the US-Iran negotiations and advance towards a durable peace in the region.

In the US, investors will be attentive to the JOLTS Job Openings report, due later on Tuesday. This will be the first of an array of labour statistics due this week, including the key Nonfarm Payrolls report, scheduled for Friday, which is expected to shed some more light on the US Federal Reserve’s monetary policy path.

Economic Indicator

Trade Balance

The Trade Balance released by the Federal Customs Administration is a measure of balance amount between import and export. A positive value shows a trade surplus while a negative value shows a trade deficit. Any variation in the figures influences the domestic economy. Generally speaking, if a steady demand in exchange for Swiss exports is seen, that would turn into a positive growth in the trade balance, and that should be positive for the CHF.

Economic Indicator

Exports (MoM)

Exports of goods and services, released by Federal Customs Administration, consist of transactions in goods and services (sales, barter, gifts or grants) from residents to non-residents.