Swiss Franc Surges as Strong Data Trumps US Labor Market Disappointment

The Swiss Franc (CHF) surged against the US Dollar (USD) during European trading on Thursday, driven by strong economic data from Switzerland. The USD/CHF pair dropped to intraday lows below 0.8100 after reaching a fresh monthly peak of 0.8156 on Wednesday.

Switzerland's Gross Domestic Product (GDP) expanded by 1.9% in the second quarter, its strongest quarterly growth in five years and above the 1.6% consensus forecast. This was followed by inflation data showing a 0.4% monthly increase in consumer prices in August, with year-over-year growth accelerating to 0.8%, double July's rate.

The US Labor Market data disappointed, however, with private sector employment increasing by only 38K in August, below the expected 44K and marking the weakest outcome in seven months. Federal Reserve officials, including New York Fed President John Williams, downplayed inflation concerns, stating that rising bond yields reflect a solid economy.