• Swiss franc weakens amid higher European bond yields.
  • US Dollar firm on the back of risk aversion.
  • USD/CHF up on Friday, but still down for the week.

The USD/CHF is rising for the second day in a row. It hit a four-day high at 0.9318 and the pulled back following the US S&P Global PMI that came in below expectations. Still, the Dollar continues to receive support from risk aversion.

USD/CHF off highs, still up

The USD/CHF pulled back to 0.9290 after the economic report but it is still up for the day supported by a stronger US Dollar across the board and a weaker Swiss Franc, following the European Central Bank meeting.

On Wednesday, USD/CHF bottomed at 0.9212, the lowest level since early March. It then started a bullish correction that gained momentum after central bank’s meetings. The Swiss National Bank, the Federal Reserve and the European Central Bank raised rates by 50 basis points to control inflation.

The hawkish tone of the ECB boosted German yields, and weighed on the Swiss Franc. The 10-year German yield jumped from 1.95% to 2.20%. The EUR/CHF cross rose from held above 0.9830 and now is testing 0.9900.

The last economic report of the week, showed the preliminary November US S&P Global Manufacturing PMI fell from 47.7 to 46.2, while the Service PMI fell from 46.2 to 44.4 against expectations of a recovery to 46.8. The numbers weakened the Dollar that pulled back across the board.

On a weekly basis, USD/CHF is still headed toward the lowest close since April, far from the bottom. It is the fourth weekly decline in a row. The rebound from the lows show some difficulties for the pair in extending the downside.

Technical levels

This article was originally published by Fxstreet.com.Read the original article here.