USD / CHF rises to test last week’s highs near 0.9190

• The US dollar gains momentum across the board amid risk aversion and rising US yields.
• The Swiss franc falls back against its European rivals.
• USD / CHF remains in the weekly range, now closer to the upper limit.

USD / CHF broke above 0.9165 / 70 and rose to 0.9186, reaching the highest level in almost a week. The pair remains close to the daily high and also close to the 0.9190 / 0.9200 resistance zone. The higher move was triggered by rising US yields. The US 10-year yield rose to 1.38%, the highest level since mid-July.

A break above 0.9200 should strengthen the outlook for the US dollar; while on the downside, key short-term support is 0.9100, with a close below leaving the pair vulnerable.

Looking at the ECB

“Recent price measures suggest that the market has become a bit more aggressive towards the ECB, all to the benefit of the euro. However, we doubt that the ECB will provide any aggressive clues through the reduction (the front load of the purchases should remain in place, in our opinion) or through inflation forecasts. In turn, the EUR could give up some of its recent gains, “explained ING analysts.

Regarding Switzerland, in ING, the observation that extremely low inflation expectations and the very moderate monetary policy of the ECB should not lead to an adjustment of the monetary policy of the Swiss National Bank in the coming years. They expect the key interest rate to remain at -0.75% until at least 2024.

Technical levels