USD/CHF looks vulnerable above 0.8920 ahead of Swiss Inflation and US PMI
|- USD/CHF is struggling in keeping its auction above 0.8920 amid weakness in the USD Index.
- S&P500 futures are showing choppy moves as investors are getting cautious ahead of the quarterly result season.
- US Manufacturing PMI is expected to continue its seven months contraction further.
The USD/CHF pair has fallen back after a short-lived recovery move to near 0.8957 in the Asian session. The Swiss Franc asset is expected to continue its downside journey after dropping below the crucial support of 0.8930 ahead of crucial economic events.
S&P500 futures are showing choppy moves in early Europe as investors are getting cautious ahead of the kick-start of the quarterly result season and the release of the United States Manufacturing PMI data (June). Investors are worried that quarterly figures from banking stocks could be subdued due to tight credit conditions and technology stocks could remain under pressure amid expectations of weak guidance.
The US Dollar Index (DXY) has faced barricades around 103.00 as the overall market mood is quite upbeat. Investors are anticipating that the Federal Reserve (Fed) will not raise interest rates more than once by year-end. While Fed chair Jerome Powell has already conveyed that two small interest rate hikes are appropriate.
Later on Monday, the street will keep focusing on the US Manufacturing PMI, which will release at 14.00 GMT. According to the preliminary report, Manufacturing PMI is seen expanding to 47.2 vs. the former release of 46.9. This indicates that the economic data would continue its seven monthly contractions further.
On the Swiss Franc front, investors are awaiting June inflation data. Annual Consumer Price Index (CPI) data is seen softening to 1.8% vs. the prior release of 2.2%. Higher interest rates by the Swiss National Bank (SNB) are weighing heavily on price pressures. SNB Chairman Thomas J. Jordan has already conveyed that more rate hikes are expected ahead.
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