In the early European session on Wednesday, the USD/CHF gains 0.25% on the day, reaching about 0.8950.
The US dollar is supported by the Fed's cautious approach.
The CHF may benefit from increased safe-haven flows brought on by the risk-off attitude and ongoing Russia-Ukraine conflicts.
During early European trading hours on Wednesday, the USD/CHF pair breaks its four-day losing streak by edging higher to around 0.8950. Despite poor US economic data and US President Donald Trump's concerns about tariffs, the US dollar (USD) bounces back from an 11-week low.
The US Federal Reserve's (Fed) cautious approach helps keep the USD's losses to a minimum. In regards to central bank interest rate policy, Richmond Fed President Thomas Barkin stated late Tuesday that he will wait and see until it is evident that inflation is returning to the Fed's 2% target. Austan Goolsbee, the president of the Chicago Fed, said Monday that the US central bank needs more clarity before it can consider lowering interest rates.
However, investor sentiment may be affected and the greenback may be under some selling pressure due to the weak US Conference Board's Consumer Confidence Index. The US Consumer Confidence Index experienced its biggest decline since August 2021, falling from 105.3 in January to 98.3 in February. According to the CME FedWatch tool, the outcome, when combined with other weak data, raised expectations that the Fed will cut interest rates by two quarter points this year, with the next one most likely to occur in July.
Uncertainty and the ongoing wars between Russia and Ukraine may strengthen safe-haven currencies like the Swiss franc (CHF). Vladimir Putin, the president of Russia, stated on Monday that a deal to end the conflict may still be a long way off and that while Europe's involvement in peace talks in Ukraine will eventually be necessary, Moscow wants to establish trust with Washington first.
The US dollar is supported by the Fed's cautious approach.
The CHF may benefit from increased safe-haven flows brought on by the risk-off attitude and ongoing Russia-Ukraine conflicts.
During early European trading hours on Wednesday, the USD/CHF pair breaks its four-day losing streak by edging higher to around 0.8950. Despite poor US economic data and US President Donald Trump's concerns about tariffs, the US dollar (USD) bounces back from an 11-week low.
The US Federal Reserve's (Fed) cautious approach helps keep the USD's losses to a minimum. In regards to central bank interest rate policy, Richmond Fed President Thomas Barkin stated late Tuesday that he will wait and see until it is evident that inflation is returning to the Fed's 2% target. Austan Goolsbee, the president of the Chicago Fed, said Monday that the US central bank needs more clarity before it can consider lowering interest rates.
However, investor sentiment may be affected and the greenback may be under some selling pressure due to the weak US Conference Board's Consumer Confidence Index. The US Consumer Confidence Index experienced its biggest decline since August 2021, falling from 105.3 in January to 98.3 in February. According to the CME FedWatch tool, the outcome, when combined with other weak data, raised expectations that the Fed will cut interest rates by two quarter points this year, with the next one most likely to occur in July.
Uncertainty and the ongoing wars between Russia and Ukraine may strengthen safe-haven currencies like the Swiss franc (CHF). Vladimir Putin, the president of Russia, stated on Monday that a deal to end the conflict may still be a long way off and that while Europe's involvement in peace talks in Ukraine will eventually be necessary, Moscow wants to establish trust with Washington first.
