Investing.com - The euro rose to two-and-a-half year highs against the Swiss franch on Friday, as optimism over a growing euro zone economy and the possible winding down of monetary stimulus in the near future continued to lend broad support to the single currency.
EUR/CHF hit 1.1372 during European morning trade, the pair’s highest since January 2015; the pair sybsequently consolidated at 1.1368, gaining 0.91%.
The euro has been largely supported in recent weeks, after European Central Bank President Mario Draghi signaled in June that it could soon start tapering its stimulus program.
In at a press conference in Frankfurt last week, Draghi said policy makers are still waiting for inflation to catch up with the economic recovery as the central bank puts off discussions on winding back stimulus until after the summer.
“We are finally experiencing a robust recovery where we only have to wait for wages and prices to follow course,” he said.
In Switzerland, data earlier showed that the KOF Economic Barometer rose to 106.8 this month from 105.8 the previous month, beating expectations for an uptick to 106.0.
The euro was also higher against the U.S. dollar, with EUR/USD up 0.29% at 1.1713, just off Thursday’s two-and-a-half year peak of 1.1777.
Sentiment on the greenback remained vulnerable after the Federal Reserve said on Wednesday that inflation remains below its 2% target even as near-term risks to the economic outlook appear “roughly balanced.” In the past, the Fed judged that weakness in inflation was transitory.
The central bank’s cautious tone on inflation sparked fresh uncertainty over the possibility of a third rate hike this year.
The dollar was also fragile after Senate Republicans failed to pass their Obamacare repeal bill in a dramatic vote of 49-51 late Thursday night.
At least three Republicans, incuding Sen. John McCain, voted against the bill which needed a simple majority to pass in the Senate. President Donald Trump reacted to the vote by saying the three had "let the American people down".