- USD / CHF rises for the third day in a row, close to the weekly high.
- The dollar remains firm but without advancing in the market before the decision of the Fed.
- The Swiss franc will also face the decision on Thursday from the ECB.
USD / CHF rose closer to the upper end of its weekly trading range during the European session, although it struggled to capitalize on the move beyond 0.9250.
The pair built on the good bounce the day before from levels below 0.9200, or lows in a week, and gained some moment in European hours on Wednesday. The franc could not benefit from some weakness in equity markets. For its part, the dollar presents mixed results for the Federal Reserve meeting.
Investors seem convinced that the Fed would be forced to tighten its monetary policy sooner than previously anticipated to contain rising inflation. Market bets were reaffirmed with Tuesday’s release of the US Producer Price Index on Tuesday, which posted the largest annual advance since November 2010 and accelerated to 9.6% year-on-year in November.
Aside from this, a modest rally around US Treasury yields should help jump-start dollar demand and continue to provide some support to the USD / CHF pair. Traders, however, could refrain from aggressive bets, instead preferring to move on the sidelines ahead of the long-awaited FOMC monetary policy decision at 19:00 GMT.
Meanwhile, traders are likely to take cues from the US monthly retail sales figures. This, along with US bond yields, will influence dollar price dynamics.
Technical levels
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