USD/CHF sees a cushion around 0.9550 as US CPI catches the spotlight
|- USD/CHF is eyeing the 0.9550 figure, critical support ahead of the US Inflation.
- Declining oil prices are responsible for lower consensus for US CPI.
- SNB’s hawkish stance is still fresh despite the unchanged inflation rate at 3.5% released last week.
The USD/CHF pair has turned sideways after catching bids around 0.9550 in the early Tokyo session. On Monday, the asset defended the two-day support of 0.9540 and a responsive buying action pushed the asset higher. The major will likely display action as per the positions adjusting ahead of the US Inflation.
Per the market consensus, the US Consumer Price Index (CPI) will likely trim to 8.7% from the prior release of 9.1%. A drop by 40 basis points in the consensus is backed by declining oil prices over the past few weeks. The black gold lost its mojo on accelerating recession fears and trimming supply worries. This may delight the Federal Reserve (Fed) to head a little soft this time on interest rates.
The upbeat US Nonfarm Payrolls have also Nonfarm Payrolls have shrugged off higher unemployment fears. The job additions in the labor market at 528k exceeded the expectations of 250k despite a halt in the recruitment process by various US corporate players.
Well, the economic condition is not fixed yet as the US CPI is still to release. Also, a continuous slowdown in the price pressures is crucial to determine a decline in the price rise index. Therefore, a wait-and-watch game will continue to persist.
On the Swiss franc front, the unchanged inflation rate released last week at 3.5% doesn’t trim the odds of a rate hike by the Swiss National Bank (SNB), but hawkish guidance could get mild. This week, a light Swiss economic calendar economic calendar this week will remain more dependent on the greenback.
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