USD/CHF drifts away from the 0.8000 level ahead of the FOMC minutes

• The US Dollar is giving away gains, although it remains trading within previous ranges.
• The Dollar and the Swiss Franc remain buoyed by the cautious market sentiment.
• Investors look to the release of the FOMC minutes fri further USD guidance.
  

The US Dollar recovery from 14-year lows, at 0.7870, was rejected on Tuesday at 0.8000 for the second consecutive day, and the pair is trading lower on Wednesday, returning to the mid-range of the 0.7900s.

The Swiss Franc is drawing support from a cautious market sentiment and a somewhat softer Dollar, amid a mild pullback in US Treasury yields to retrace some losses. However, price action remains trapped well within Monday’s trading range.

The Dollar and the Swiss Franc appreciate in cautious markets

Risk sentiment has improved somewhat, as investors digested an unexpected turn in Trump’s trade saga, but risk appetite remains subdued, given the highly uncertain outlook for global trade. Safe assets, such as the US Dollar and the Swiss Franc, are among the largest beneficiaries in this context.

The focus now shifts to the release of the minutes of June’s Federal Reserve meeting. Powell surprised after that meeting, with an unexpectedly hawkish stance that curbed hopes of rate cuts in July or September and provided support to the US Dollar.

Later on, US employment data from June confirmed the resilience of the labour market and eased pressures, other than those by Trump, to reduce interest rates. The meeting minutes might endorse that view later today and give an additional boost to the Greenback.