- USD/CHF may continue its losing streak despite the strengthening US Dollar.
- The Swiss franc may advance further due to safe-haven flows amid the lack of a truce agreement between Israel and Hamas.
- Dollar holds gains on market caution ahead of Fed Chair Powell’s speech at the Jackson Hole Symposium.
The USD/CHF remains tepid around 0.8520 during the Asian session on Thursday, with a negative bias set to continue its losing streak for the fifth consecutive day. The Swiss Franc (CHF) could receive support from safe-haven flows due to the stalemate in reaching a truce agreement between Israel and Hamas, which leaves the door open for a wider conflict in the Middle East.
On Wednesday, US President Joe Biden urged Israeli Prime Minister Benjamin Netanyahu to prioritize achieving a Gaza truce and releasing hostages, but both Israel and Hamas stood firm on their respective demands. The conversation, which also included Vice President Kamala Harris, came after Palestinian health officials reported that at least 50 Palestinians had been killed by Israeli airstrikes in 24 hours, according to a Reuters report.
Commerzbank FX analyst Michael Pfister noted that the recent market turbulence generated strong demand for safety, which positively impacted the Swiss Franc (CHF). However, Pfister anticipates moderate CHF weakness in the coming months, predicting that the Swiss National Bank (SNB) will likely cut interest rates further.
The US Dollar (USD) is up on improving Treasury yields, which could be attributed to market caution ahead of Federal Reserve (Fed) Chairman Jerome Powell’s keynote speech at the Annual Jackson Hole Symposium scheduled for Friday.
Moreover, the FOMC minutes from the July monetary policy meeting indicated that most Fed officials agreed last month that they would likely cut their benchmark interest rate at the next meeting in September as long as inflation continued to cool. Moreover, traders are awaiting Fed Chair Jerome Powell’s upcoming speech at Jackson Hole on Friday.
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.
