- The US CPI rises to 7.1% year-on-year, while core inflation falls to the 6% threshold.
- USD/CHF: A daily close below 0.9300 would pave the way towards 0.9150.
- Investors’ attention turned Wednesday to the Federal Reserve’s monetary policy.
USD/CHF stumbles and renews eight-month lows around 0.9231 after reaching a daily high of 0.9375 after the release of US inflation figures, which softened a bit, taking pressure off the Federal Reserve (Fed), which will meet on Wednesday for the last time of the year. As of this writing, USD/CHF is trading at 0.9280, below its opening price, down 0.85% on the day.
US inflation falls, a headwind for USD/CHF
Wall Street continues to trade with gains, while the US dollar (USD) plunges. On Tuesday, the US Department of Labor released the Consumer Price Index (CPI) for November, which registered a year-on-year decrease of 7.1%, below analysts’ forecasts, which placed it at 7.3%. Furthermore, the core CPI rose in September and then fell again, coming in at 6% below initial forecasts of 6.3% for the November figures.
The US dollar index, which measures the value of the dollar against a basket of six currencies, fell 0.99% to 103.961, after hitting a low of 103.586, hurt by falling US Treasury yields. In fixed income, the 10-year US Treasury yield falls 12 basis points to 3.485% as traders begin to anticipate a less aggressive Federal Reserve.
As regards Switzerland, Seco’s economic forecasts confirmed that the Swiss economy is estimated to grow at a significantly below-average rate of 1.0% in 2023, followed by 1.6% of GDP in 2024. It must be said that the projections they assume that there will be no shortage of power supply in 2022 and 2023 next winter.
USD/CHF Price Analysis: Technical Perspective
USD/CHF broke down the falling wedge, although a daily close below 0.9300 would be needed to further consolidate the downside bias, confirmed by oscillators. The Relative Strength Index (RSI), in bearish territory, points lower. In the case of the Rate of Change (RoC), it continues to push downwards, portraying that sellers are gaining momentum.
Therefore, the key support levels of the USD/CHF are the figure of 0.9200followed by the daily low of March 22 in 0.9194ahead of the daily low of February 21 in 0.9150.
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.
