USD/CHF recovers amid Fed’s hawkish hold

Source Fxstreet
  • USD/CHF trades at 0.8944, recovering from daily lows of 0.8893 following the Fed's hawkish stance.
  • Fed keeps rates at 5.25%-5.50%, revises federal funds rate projection to 5.1% for end of 2024.
  • May’s US inflation data is weaker than April’s, impacting USD as Treasury yields plunge; upcoming PPI and jobless claims data are in focus.

The USD/CHF remains in the red, yet off daily lows of 0.8893 after the US Federal Reserve held rates unchanged and tilted hawkish. Policymakers expected just one rate cut instead of the three foresaw in the Summary of Economic Projections (SEP) in March 2024. Therefore, traders booked profits as the major recovered some ground and exchanged hands at 0.8944, down 0.35%.

Swiss Franc trims some gains after Fed’s adjust interest rate cut expectations

Federal Reserve officials tilted hawkish on their June monetary policy meeting decision via the Summary of Economic Projections (SEP), as they project just one interest rate cut instead of the three foresaw since the December 2023 meeting. They voted unanimously to keep the federal funds rate (FFR) at around 5.25%-5.50% and upward revised their inflation expectations as measured by the Personal Consumption Expenditure (PCE) Price Index.

The SEP showed that Fed officials upward revised their projections of the federal funds rate from 4.6% to 5.1% toward the end of 2024. Regarding Gross Domestic Product (GDP) for 2024, they project a 2.1% increase, as foreseen in March, while the Unemployment Rate is projected at 4%, unchanged from March’s SEP. PCE inflation is expected to rise from 2.4% to 2.6%, and Core PCE is expected to rise from 2.6% to 2.8%.

Earlier, the US Bureau of Labor Statistics (BLS) revealed that May’s inflation in the US was unchanged, but lower than April’s data. This weakened the Greenback due to plunging US Treasury bond yields.

Ahead of the week, the US economic docket will feature May’s Producer Price Index (PPI) and Initial Jobless Claims (IJC) on Thursday.

USD/CHF Price Analysis: Technical outlook

From a daily chart perspective, the USD/CHF dived and tested the 200-day moving average (DMA) at 0.8896 before recovering from its earlier losses. Although the pair aimed higher, it was capped at the 100-DMA at 0.8949, a strong resistance level. If it’s cleared, the pair could rally toward 0.9000 and beyond. On the downside, the first support would be the 200-DMA at 0.8896. Key support levels lie below, like the 0.8800 figure.

USD/CHF

Overview
Today last price 0.8944
Today Daily Change -0.0032
Today Daily Change % -0.36
Today daily open 0.8976
 
Trends
Daily SMA20 0.9044
Daily SMA50 0.9075
Daily SMA100 0.8945
Daily SMA200 0.8893
 
Levels
Previous Daily High 0.8993
Previous Daily Low 0.8959
Previous Weekly High 0.9036
Previous Weekly Low 0.8881
Previous Monthly High 0.9225
Previous Monthly Low 0.8988
Daily Fibonacci 38.2% 0.898
Daily Fibonacci 61.8% 0.8972
Daily Pivot Point S1 0.8959
Daily Pivot Point S2 0.8942
Daily Pivot Point S3 0.8924
Daily Pivot Point R1 0.8993
Daily Pivot Point R2 0.9011
Daily Pivot Point R3 0.9028

 

 

Disclaimer: For information purposes only. Past performance is not indicative of future results.
placeholder
Dollar holds above 100 near a 3-month high — three Fed speakers and a $69 billion auction land tonightThe dollar index closed at 100.43 on Monday, its highest close since late July, after a weekly gain of about 1% — the best in more than three months — and is holding above the 100.00 handle in Asia. Three Fed officials speak tonight alongside a $69 billion two-year note auction, the first leg of $183 billion of Treasury supply this week.
Author  Suzie
Sep 22, Tue
The dollar index closed at 100.43 on Monday, its highest close since late July, after a weekly gain of about 1% — the best in more than three months — and is holding above the 100.00 handle in Asia. Three Fed officials speak tonight alongside a $69 billion two-year note auction, the first leg of $183 billion of Treasury supply this week.
placeholder
October hike odds climb toward 60% as Goldman and BofA both flip — what Warsh's "dose of accommodation" really changedRate futures now price roughly 55% to 62% for a 25bp hike at the October 27-28 FOMC, up from about 30% before Chair Warsh's post-meeting framing that the Fed is merely "removing some accommodation." Goldman Sachs has added an October hike to its forecast and Bank of America now sees moves in both October and December. Here is the repricing, the language behind it, and the two data points that decide it.
Author  Irene Q.
Sep 23, Wed
Rate futures now price roughly 55% to 62% for a 25bp hike at the October 27-28 FOMC, up from about 30% before Chair Warsh's post-meeting framing that the Fed is merely "removing some accommodation." Goldman Sachs has added an October hike to its forecast and Bank of America now sees moves in both October and December. Here is the repricing, the language behind it, and the two data points that decide it.
placeholder
Memory chips surge, Nasdaq notches a second straight record close — why the Dow fell 185 points anywayMicron gained 5%, SanDisk 6.8%, Seagate 4% and Western Digital 3% as the memory complex led the Nasdaq Composite to a second consecutive record close of 27,244.28. But the Dow fell 185 points as JPMorgan, Wells Fargo and Schwab slid more than 3% each — a split tape that says more about positioning than about the economy.
Author  Irene Q.
Sep 23, Wed
Micron gained 5%, SanDisk 6.8%, Seagate 4% and Western Digital 3% as the memory complex led the Nasdaq Composite to a second consecutive record close of 27,244.28. But the Dow fell 185 points as JPMorgan, Wells Fargo and Schwab slid more than 3% each — a split tape that says more about positioning than about the economy.
placeholder
Gold Price Forecast: XAU/USD drifts toward $4.300 with bears gaining tractionGold (XAU/USD) retraces Tuesday’s gains on Wednesday and drifts lower, approaching the $4,300 area as the US Dollar Index (DXY) rallies further amid high US Treasury yields.
Author  FXStreet
Sep 23, Wed
Gold (XAU/USD) retraces Tuesday’s gains on Wednesday and drifts lower, approaching the $4,300 area as the US Dollar Index (DXY) rallies further amid high US Treasury yields.
placeholder
US input costs rose at the fastest pace in four years — the September flash PMI beat is an inflation story, not a growth storyUS September flash PMIs came in far above expectations, with the composite at 58.4, a five-year high. But the detail that moved markets was input cost inflation at its fastest since October 2022, driven by fuel, transport and supply shortages. Brent is back above $100 and the 10-year Treasury yield has hit its highest since 2007.
Author  Suzie
Yesterday 06: 46
US September flash PMIs came in far above expectations, with the composite at 58.4, a five-year high. But the detail that moved markets was input cost inflation at its fastest since October 2022, driven by fuel, transport and supply shortages. Brent is back above $100 and the 10-year Treasury yield has hit its highest since 2007.
Related Instrument
goTop
quote