The Euro to Swiss Franc (EUR/CHF) and Euro to New Zealand Dollar (EUR/NZD) exchange rates were both trending lower in Monday’s European trading as investors speculated on whether Greece would fail to make an International Monetary Fund (IMF) loan repayment and leave the Eurozone as a result.
Furthermore, there’s more trouble in the Eurozone with Finland’s Eurosceptic party the Finns jumping to second place in the nation’s general election last night. The Finns managed to bag 38 seats while the winning party secured the lead with 49.
Final results in Finnish elections. Centre Party winners. €sceptic Finns Party beats expectations w/ 2nd most seats pic.twitter.com/2PYSntFImH
— Open Europe (@OpenEurope) April 20, 2015
Politics professor Ilkka Ruostetsaari commented: ‘It looks like a very good result for the Finns party. It will be hard to disregard them in forming the government.’
Fears are rising that a possible Grexit could lead other nations to consider leaving the currency bloc. Finland has been hit hard by Eurozone membership with its lumber industry noting particular losses, as well as former phone giant Nokia’s demise and problems from neighbouring Russia spilling over into Finland’s economic struggle.
It seems with the results of Finland’s general election that the Eurozone may be in for a chaotic time over the coming years as nation’s broach the possibility of leaving the currency bloc as Greece currently is.
New Zealand Dollar (NZD) Exchange Rate Forecast
Meanwhile, the New Zealand Dollar was offered little support when the New Zealand Consumer Price Index (CPI) slipped from 0.8% to 0.1% on the year in quarter one. Quarter-on-quarter the index slipped by -0.3%, more than the -0.2% forecast.
However, the New Zealand Dollar was propped up against other majors when the People’s Bank of China (PBoC) increased stimulus measures within the Chinese economy, New Zealand’s largest trading partner.
ANZ Bank economist Sharon Zollner commented: ‘The New Zealand Dollar has been boosted by further Chinese stimulus. The RRR cut is expected to release 1.2 trillion Yuan in liquidity to support demand.’
Swiss Franc (CHF) Exchange Rate Forecast
Meanwhile, the Swiss Franc’s recent rise has caused further fears over the banking system’s ability to control the currency market. The Swiss National Bank (SNB) made a shock move in January, by removing the cap between the Euro and the Swiss Franc (EUR/CHF).
Major banks, including Barclays, Goldman Sachs and America Corp., have all attempted to reduce their losses by asking customers to change trades.
Analyst Kevin McPartland commented: ‘There’s not really a middle man. Foreign exchange is still over the counter, so you’re still mostly dealing one-to-one in your trades, which I guess is why we were in this state of renegotiation.’
Euro to Swiss Franc (EUR/CHF) and Euro to New Zealand Dollar (EUR/NZD) Exchange Rate Forecast
The Euro to Swiss Franc (EUR/CHF) and Euro to New Zealand Dollar (EUR/NZD) exchange rates could be in for an influential day on Tuesday with the release of ZEW’s German Economic Sentiment Survey, which is forecast to increase from 54.8 to 55.3 in April.
Thursday will see the release of Swiss Trade Balance figures as well as New Zealand Credit Card Spending ecostats.
UPDATE: Greece appears to have forced local governments to move all cash balances to the central bank.
— Manus Cranny (@ManusCranny) April 20, 2015
The Euro to New Zealand Dollar (EUR/NZD) exchange rate is trading at 1.3989; the Euro to Swiss Franc (EUR/CHF) exchange rate is trending in the region of 1.0252.