Several factors within a nation can have a significant effect on the currency exchange
rates and the relative importance of each is the subject of debate; however, it is important
to be aware of some of the key fundamentals. In addition to these concerns, Swiss
Franc’s specific image as it relates to foreign investment may also falter if the perceived
degree of banking secrecy is altered under external political pressures.
Inflation: It is generally believed that countries with consistently lower inflation exhibit a
rising currency value while countries with higher inflation may see currency depreciation.
Interest Rates: High interest rates may attract foreign investors and that can lead to an
exchange rate increase while the opposite scenario is possible in a country with low
interest rates.
Overall Economic Conditions: Everything from a country’s balance of trade to the size of
their deficit or surplus can serve as a barometer of the condition of the country and the
likelihood of default. Investors look for countries with stronger economic foundations
and the better the economic foundation of one country versus another may increase the
value of the country’s currency. Sovereign credit ratings from places like Moody’s or
S&P can impact the perception of a nation’s growth and stability. Economic statistics for
Switzerland may be found on the Swiss Statistics website.
Perception: The so called “flight to quality” exists within foreign currencies as investors
will often seek what they perceive as “safe haven” currencies during times of political or
economical instability.
Disclaimer: There is a substantial risk of loss in futures trading and it is not suitable for
all investors. Past results are by no means indicative of potential future returns.
Fundamental factors, seasonal and weather trends, and current events may have already
been factored into the markets.
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prohibited without the expressed written consent of Futures Press, Inc.
Disclaimer: There is risk of loss in all commodities trading. Losses can exceed your account size and/or margin requirements. Commodities trading can be extremely risky and is not for everyone. Some option strategies have unlimited risk. Educate yourself on the risks and rewards of such investing prior to trading. Futures Press Inc., the publisher, and/or its affiliates, staff or anyone associated with Futures Press, Inc. or www.learnaboutfutures.com, do not guarantee profits or pre-determined loss points, and are not held monetarily responsible for the trading losses of others (subscribers or otherwise). Past results are by no means indicative of potential future returns. Options DO NOT necessarily move lock step with the underlying futures contract. Information provided is compiled by sources believed to be reliable. Futures Press, Inc., and/or its principals, assume no responsibility for any errors or omissions as the information may not be complete or events may have been cancelled or rescheduled. Any copy, reprint, broadcast or distribution of this report of any kind is prohibited without the expressed written consent of Futures Press, Inc.