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Swiss franc slips versus the dollar amid renewed Middle East tensions
USD/CHF is around 0.8080 after US economic data supported the dollar, while markets via CME FedWatch price hikes from 58% in September to 76% by December.
The Swiss franc weakened against the US dollar on Thursday as the dollar regained momentum after a two-day slide, with USD/CHF trading around 0.8080, up nearly 0.35% on the day after dipping to 0.8044 earlier.
FXStreet attributed the shift in part to a rebound in the greenback following softer inflation data earlier this week that reduced expectations for an immediate Federal Reserve rate hike, but said renewed Middle East tensions are lifting oil prices again and keeping broader rate hike risks on the table.
According to the CME FedWatch Tool, markets are pricing in a 58% chance of a Fed rate hike by September, rising to 65% by October and 76% by December. The dollar also found support from US data, including initial jobless claims falling to 208K for the week ending July 11, and June retail sales rising 0.2% month over month.
FXStreet also pointed to comments from the Swiss National Bank, noting that recent assessment showed the franc had depreciated versus the US dollar and euro since March, with SNB saying current conditions are appropriate, while warning that geopolitical uncertainty could push the franc higher and that it remains willing to intervene in FX markets.