Swiss GDP came out 1% higher than expectations, at 3.4% compared to forecasts of 2.4%. The Swiss economy expanded at an above-average rate for the fifth quarter in a row. This expansion was largely supported by manufacturing, which has been in a strong upturn since spring 2017. The main growth sector was energy production, which registered growth rates of 4.8%, stemming mainly from hydropower and nuclear power plants. As a result, exports of industrial products and energy rose sharply. However, a slowdown was observed in various production sectors with domestic focus, domestic final demand ran out of steam somewhat, which caused a fall in imports of goods and services by -0.7 %.
The Swiss economy now grows at a faster rate than the Euro area (3.4% compared to 2.2% in Q2), something which is reflected in the EURCHF behaviour. The small downwards trend was reinforced by the GDP results, closing 8 pips lower than the previous hour. At the time of writing, the Swissy broke the 1.1278 2-day support level which is also the 61.8% Fib level. If maintained below this level, it could lead to re-testing the 76.4% Fib. level at 1.1268. Otherwise, it would most likely return to 50% Fib. level at 1.1286.