- USD/CHF falls to new low in months on renewed dollar weakness.
- Diminishing odds of an aggressive Fed continue to weigh on the dollar.
The USD/CHF pair falls for the fourth day in a row and hit a four-month low during the European session. Price shows resilience around 0.9400 and cut losses but unable to break above 0.9415. Should the pair confirm below 0.9400, it would be a bearish sign and could imply a confirmation of the break of the 200-day moving average.
The lower-than-expected US CPI report led investors to lower expectations of a 75 basis point Fed rate hike in September, which played against the dollar and pushed up prices. equity markets. Optimism in turn limits the advance of the Swiss franc.
For its part, the Fed is still expected to raise interest rates by 50 basis points at the monetary policy meeting in September. This, in turn, supports the prospect of some buying in the event of sharp declines around the dollar and further warrants some caution for aggressive bear traders. Market participants now expect new US data to be released on July’s Producer Price Index (PPI) and weekly jobless claims report.
Technical levels
Source: Fx Street
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