The Swiss franc edged sharply lower against its major rivals in early deals on Wednesday following the publication of SNB President Thomas Jordan's Tuesday's remarks on EUR/CHF floor rate.
According to Jordan, the floor rate of 1.20 will be maintained by the Swiss National Bank as long as necessary. He added that the bank did not rule out negative interest rates.
Switzerland's central bank set the cap in September 2011 to prevent deflation and massive appreciation of the local currency and the SNB has been maintaining the floor rate since then with utmost determination.
While dismissing talk of a currency war, Jordan said the major central banks' decisions had not been motivated to weaken other nation's policies.
In Europe, major bourses are trading in negative territory amid speculation the Federal Reserve would continue providing economic stimulus until next year given low inflation and mixed signals for growth prospects.
Nevertheless, caution prevails as Fed Chairman Ben Bernanke testifies before the Joint Economic Committee of Congress later in the global day.
Besides Bernanke's speech, traders also await existing U.S. home sales data as well as the minutes of the latest Fed meeting for hints of potential changes in the Fed's asset purchase program.
In the U.K.. the call for additional stimulus by Bank of England chief Mervyn King was overturned by other policymakers for the fourth consecutive month, minutes showed today.
As seen in previous months, King, Paul Fisher and David Miles sought an increase in quantitative easing by GBP 25 billion to GBP 400 billion.
The nine-member Monetary Policy Committee unanimously decided to maintain the record low 0.50 percent interest rate.
Retail sales in the UK declined unexpectedly in April, the latest figures from the Office for National Statistics showed today.
Retail sales volume, including auto fuel, fell 1.3 percent month-on-month in April against forecast for a 0.1 percent increase. Sales, excluding fuel, dropped 1.4 percent compared with an expected 0.1 percent growth.
The Bank of Japan decided to keep its ultra-loose monetary policy unchanged today, suggesting that the bank is moving cautiously amid concerns over the recent turmoil in the bond market.
Reaffirming its latest easing measures, the policy board said the bank will conduct money market operations so that the monetary base will increase at an annual pace of about JPY 60-70 trillion.
Japan posted a merchandise trade deficit of JPY 879.936 billion in April, missing forecasts for a shortfall of JPY 620.6 billion following the downwardly revised deficit of 364.0 billion yen in March.
The franc fell below the 1.26 mark against the euro around 6:45 am ET, setting the domestic unit to its weakest level since May 2011. The next likely support for the franc is seen at 1.27 per euro.
The Switzerland currency also slipped back to near the 1.47 level against the pound, erasing 0.6 percent gains from Asian session's 8-day high of 1.4610. Further bearish extension could help the pair re-testing the 1.4750 level.
The Swiss franc slipped to a session's low of 0.9733 against the dollar around 6:50 am ET, backing off from Asian session's peak of 0.9680. The next likely support for the Switzerland currency is seen around the 0.9750 level.
The franc erased its recent advance against the yen in early deals on Wednesday, retreating to 105.69 around 6:45 am ET from a high of 106.23 hit earlier in the session. If the franc-yen pair extends downtrend, 105.30 is seen as the next likely support level.
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Forex News
June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.