Forex - USD/CHF weekly outlook: Oct 28 - Nov 1

Investing.com - The U.S. dollar ended the week close to 20-month lows against the traditional safe haven Swiss franc on Friday as weak U.S. economic data added to the view that the Federal Reserve will postpone plans to start reducing stimulus measures.

USD/CHF ended Friday’s session at 0.8926, almost unchanged for the day, up from lows of 0.8889 on Thursday, the lowest since November 2011. For the week, the pair dropped 1.11%.

The pair is likely to find near-term support at 0.8889, Thursday’s low and resistance at 0.9000.

Data on Friday showed that U.S. core durable goods orders unexpectedly fell 0.1% in September, the third consecutively decline. A separate report showed that the University of Michigan U.S. consumer sentiment index was revised down to a 10-month low of 73.2 from a final reading of 77.5 in September.

The data cemented expectations that the U.S. central bank will maintain the current pace of its asset purchase program into early next year.

Data released earlier in the week showing that U.S. jobs growth had slowed in September, even before the start of the 16-day government shutdown, prompted investors to re-evaluate expectations over the timing of a possible reduction to the Fed’s stimulus program.

The Department of Labor said the U.S. economy added 148,000 jobs last month, well below expectations for an increase of 180,000.

The Fed surprised investors when it unexpectedly refrained from scaling back asset purchases at its policy setting meeting in September, saying it wanted more evidence of an economic recovery.

In the week ahead, investors will be focused on the outcome of Wednesday’s Federal Reserve policy setting meeting. The central bank is expected to keep its USD85 billion-a-month asset purchase program on track.

Wednesday’s ADP nonfarm payrolls report will also be closely watched.

Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.

Monday, October 28

The U.S. is to produce reports on industrial production and the capacity utilization rate, as well as private sector data on pending home sales.

Tuesday, October 29

The U.S. is to produce data on retail sales, the government measure of consumer spending, which accounts for the majority of overall economic activity. The U.S. is also to publish data on producer price inflation and a report on consumer confidence, a leading economic indicator.

Wednesday, October 30

Switzerland is to release its KOF economic barometer, a leading indicator of economic health.

The U.S. is to release the ADP report on nonfarm payrolls and official data on consumer price inflation.

Later Wednesday, the Federal Reserve is to announce its federal funds rate and publish its rate statement. The statement is to be followed by a closely watched press conference with Chairman Ben Bernanke.

Thursday, October 31

The U.S. is to release data on initial jobless claims and a report on manufacturing activity in the Chicago region.

Friday, November 1

Switzerland is to release its SVME index, an important economic indicator.

The U.S. is to round up the week with a report from the Institute of Supply Management on manufacturing activity.