USD/CHF drops to seven-week lows, under 0.9850
|- Weaker US dollar pushes USD/CHF ahead of Fed and ECB meetings.
- Pair is about to test October lows around 0.9840.
The USD/CHF weakened further during the American session amid a decline of the US dollar across the board. The pair printed a fresh seven-week low at 0.9844. It is trading near the lows, about to test October’s bottom around 0.9840. If it drops below, it would be trading at levels not seen since early September.
The US Dollar Index is falling for the second day in a row and stands at 97.45, down 0.25% for the day and close to December‘s low. On Wednesday, the Federal Reserve will announce its decision on monetary policy. The central bank is expected to remain on hold and focus likely to be on the statement and the new economic projections.
Trade headlines on Tuesday triggered some optimism around markets but did not weigh on the Swiss franc. “Sunday's upcoming tariffs may be averted due to economic pressure on both the US and China, while investors are still speculating on the likelihood of a trade agreement amid US trade officials putting the final touches to the United States-Mexico-Canada Agreement," explained BBVA analysts.
Ahead of Thursday’s European Central Bank meeting, the Swiss franc is showing strength also versus the euro with EUR/CHF trading at three-week lows near 1.0900. The ECB is not expected to change its monetary policy stance this week at the first meeting with Lagarde as president.
Levels to watch
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