- The USD/CHF falls to about 0.8330 while the US dollar goes back to a reduction in the US.
- The US economic advisor Hasset says that more commercial agreements will be closed this week.
- SNB is expected to reduce interest rates even more
The USD/CHF pair quotes 0.5% down, about 0.8330 during negotiation hours in North America on Monday. The Swiss frank torque weakens while the US dollar (USD) faces strong sales pressure due to erosion in the sovereign credit rating of the United States (USA).
The US dollar index (DXY), which tracks the value of the dollar against six main currencies, falls to about 100.30.
American dollar today
The lower table shows the percentage of US dollar change (USD) compared to the main coins today. The US dollar was the weakest currency against the euro.
| USD | EUR | GBP | JPY | CAD | Aud | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.75% | -0.59% | -0.10% | -0.21% | -0.67% | -0.54% | -0.33% | |
| EUR | 0.75% | -0.09% | 0.47% | 0.37% | -0.02% | 0.04% | 0.20% | |
| GBP | 0.59% | 0.09% | 0.25% | 0.47% | 0.07% | 0.14% | 0.29% | |
| JPY | 0.10% | -0.47% | -0.25% | -0.09% | -0.39% | -0.23% | -0.16% | |
| CAD | 0.21% | -0.37% | -0.47% | 0.09% | -0.45% | -0.33% | -0.17% | |
| Aud | 0.67% | 0.02% | -0.07% | 0.39% | 0.45% | 0.06% | 0.23% | |
| NZD | 0.54% | -0.04% | -0.14% | 0.23% | 0.33% | -0.06% | 0.16% | |
| CHF | 0.33% | -0.20% | -0.29% | 0.16% | 0.17% | -0.23% | -0.16% |
The heat map shows the percentage changes of the main currencies. The base currency is selected from the left column, while the contribution currency is selected in the upper row. For example, if you choose the US dollar of the left column and move along the horizontal line to the Japanese yen, the percentage change shown in the box will represent the USD (base)/JPY (quotation).
On Friday, the Moody’s qualification reduced the long -term emitter and unusual debt ratings of the US of AAA1. The reduction of a level in the US credit occurred in the middle of a growing debt of 36 billion dollars. The US reduction has caused an increase in the yields of assets that generate interest. The yields of the US Treasury bonds are fired at about 4.52% at the time of writing, 1.8% more than their previous closure.
Meanwhile, the Optimism about the White House closing more agreements with its business partners could support the US dollar. During the negotiation hours in North America, the Economic Advisor of the White House, Kevin Hasett, said hopes of more commercial agreements soon. “I would not be surprised if there are more commercial agreements this week,” said Hasett.
In addition, investors’ trust on a possible commercial agreement between the US and China has increased. The president of the United States, Donald Trump, gave a positive response in an interview with Fox News on Friday about visiting China for direct commercial conversations with the Chinese president, Xi Jinping.
In the front of the Swiss Franco (CHF), investors expect more cuts in interest rates by the Swiss National Bank (SNB) due to the risk of commercial war.
US dollar FAQS
The US dollar (USD) is the official currency of the United States of America, and the “de facto” currency of a significant number of other countries where it is in circulation along with local tickets. According to data from 2022, it is the most negotiated currency in the world, with more than 88% of all global currency change operations, which is equivalent to an average of 6.6 billion dollars in daily transactions. After World War II, the USD took over the pound sterling as a world reserve currency.
The most important individual factor that influences the value of the US dollar is monetary policy, which is determined by the Federal Reserve (FED). The Fed has two mandates: to achieve price stability (control inflation) and promote full employment. Its main tool to achieve these two objectives is to adjust interest rates. When prices rise too quickly and inflation exceeds the 2% objective set by the Fed, it rises the types, which favors the price of the dollar. When inflation falls below 2% or the unemployment rate is too high, the Fed can lower interest rates, which weighs on the dollar.
In extreme situations, the Federal Reserve can also print more dollars and promulgate quantitative flexibility (QE). The QE is the process by which the Fed substantially increases the flow of credit in a stuck financial system. It is an unconventional policy measure that is used when the credit has been exhausted because banks do not lend each other (for fear of the default of the counterparts). It is the last resort when it is unlikely that a simple decrease in interest rates will achieve the necessary result. It was the weapon chosen by the Fed to combat the contraction of the credit that occurred during the great financial crisis of 2008. It is that the Fed prints more dollars and uses them to buy bonds of the US government, mainly of financial institutions. Which usually leads to a weakening of the US dollar.
The quantitative hardening (QT) is the reverse process for which the Federal Reserve stops buying bonds from financial institutions and does not reinvote the capital of the wallet values ​​that overcome in new purchases. It is usually positive for the US dollar.
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
