USD/CHF slides below 0.8500 mark, downside seems limited ahead of US inflation figures

Source Fxstreet
  • USD/CHF trades with a negative bias for the second straight day amid a softer USD.
  • The Fed rate-cut uncertainty might hold back traders from placing directional bets.
  • A positive risk tone could undermine the CHF and limit losses ahead of the US CPI.

The USD/CHF pair drifts lower for the second straight day on Thursday and slips below the 0.8500 psychological mark during the Asian session. Spot prices, however, remain confined in a familiar trading band held over the past two weeks or so as traders keenly await the release of the latest US consumer inflation figures before placing fresh directional bets.

Heading into the key US data risks, the US Dollar (USD) remains depressed in a one-week-old range amid the uncertainty over the Federal Reserve's (Fed) rate-cut path and is seen exerting some pressure on the USD/CHF pair. That said, the incoming US macro data underscored the fundamental resilience of the American economy. This, along with mixed signals from several Fed officials, forced investors to scale back expectations for a more aggressive policy easing in 2024.

In fact, New York Fed President John Williams said on Wednesday that the US central bank is in a ‘good place’ and has time to think about what’s next for rates, though would eventually need to get policy back to more neutral levels. In contrast, Atlanta Fed President Raphael Bostic earlier this week noted that the central bank still needs to give tight policy time to work on cooling off inflation, which has declined more than expected, and sees two 25 bps cuts by the year-end.

Nevertheless, diminishing odds for an imminent Fed rate cut in March allow the yield on the benchmark 10-year US government bond to hold steady above the 4.0% threshold and support prospects for the emergence of some USD dip-buying. Apart from this, a generally positive tone around the equity markets is likely to undermine the safe-haven Swiss Franc (CHF) and help limit deeper losses for the USD/CHF pair, warranting caution for aggressive bearish traders.

Investors might also prefer to wait for the release of the latest US consumer inflation figures, due later during the early North American session, which will influence the Fed's future rate decisions. This, in turn, will play a key role in driving the USD demand and determining the next leg of a directional move for the USD/CHF pair.

Technical levels to watch

 

Disclaimer: For information purposes only. Past performance is not indicative of future results.
placeholder
USD mixed to firmer ahead of jobs – ScotiabankThe US Dollar (USD) is tracking a little higher ahead of the US jobs data at 8.30ET. Yesterday’s outperformers (JPY and CHF) in early trade here are today’s underperformers as the mood in equity markets improves, Scotiabank’s Chief FX Strategist Shaun Osborne notes.
Author  FXStreet
Yesterday 12: 16
The US Dollar (USD) is tracking a little higher ahead of the US jobs data at 8.30ET. Yesterday’s outperformers (JPY and CHF) in early trade here are today’s underperformers as the mood in equity markets improves, Scotiabank’s Chief FX Strategist Shaun Osborne notes.
placeholder
Exxon Mobil reports above-consensus Q3 earnings but revenue misses estimatesInvesting.com -- Exxon Mobil (NYSE:XOM) reported earnings for the third quarter that beat analyst estimates, while revenue fell short of expectations.The energy giant delivered Q3 earnings per sha
Author  Investing.com
Yesterday 12: 14
Investing.com -- Exxon Mobil (NYSE:XOM) reported earnings for the third quarter that beat analyst estimates, while revenue fell short of expectations.The energy giant delivered Q3 earnings per sha
placeholder
Gold edges higher as geopolitical risks revive following Hezbollah attack in IsraelGold (XAU/USD) edges a third of a percentage point higher on Friday, recovering from the tumble it suffered on the previous day.
Author  FXStreet
Yesterday 12: 13
Gold (XAU/USD) edges a third of a percentage point higher on Friday, recovering from the tumble it suffered on the previous day.
placeholder
US Loses Ground: Asia Tops Crypto Developer Share By Region – ReportA recent report revealed North America is losing ground to other regions in a key sector. The continent, led by the US, was dethroned as the largest hub for crypto developers after recording a sharp decline in its developer’s share over the past decade.
Author  Bitcoinist
Yesterday 12: 11
A recent report revealed North America is losing ground to other regions in a key sector. The continent, led by the US, was dethroned as the largest hub for crypto developers after recording a sharp decline in its developer’s share over the past decade.
placeholder
Boeing shares higher as striking union endorses 38% pay bumpInvesting.com -- Boeing (NYSE:BA) shares inched higher in premarket US trading on Friday after the union representing the roughly 33,000 striking workers endorsed a new pay offer than includes a 38% wage bump over the next four years.
Author  Investing.com
Yesterday 12: 10
Investing.com -- Boeing (NYSE:BA) shares inched higher in premarket US trading on Friday after the union representing the roughly 33,000 striking workers endorsed a new pay offer than includes a 38% wage bump over the next four years.
Related Instrument
goTop
quote