Investing.com - The dollar edged lower against the Swiss franc on Wednesday, as concerns over escalating conflict in Ukraine and caution ahead of testimony by Fed Chair Janet Yellen later in the trading day weighed on market sentiment.
USD/CHF touched session lows of 0.8734 and was last trading at 0.8737.
The pair was likely to find support at 0.8720, Tuesday’s low and a seven-week trough and resistance at 0.8779, Tuesday’s high.
Demand for the traditional safe haven Swiss franc was underpinned by concerns over events in Ukraine, as conflict between the government and pro-Russian separatists in the east and south of the country continued to escalate, fuelling fears over a civil war.
The dollar was also on the back foot ahead of congressional testimony by U.S. central bank head Janet Yellen later Wednesday.
The Fed chair was widely expected to reiterate interest rates will remain on hold for longer, in spite of last month’s stronger-than-forecast U.S. nonfarm payrolls report.
The Swiss franc was little changed after the Swiss National Bank said Wednesday that its foreign currency reserves rose in April.
The Swiss central bank said it held 438.949 billion Swiss francs in foreign currency at the end of April, up from 437.935 billion in March, indicating that it has not been actively buying euros to defend its 1.20 Swiss francs per euro minimum exchange rate floor.
The SNB imposed the exchange rate floor in September 2011 to help stave off the risk of deflation and recession, as safe haven inflows prompted by the crisis in the euro zone pushed the Swiss franc close to parity with the euro.
The Swissy was almost unchanged against the euro, with EUR/CHF at 1.2172.