Swiss Franc hits a ten-month low as hawkish Fed bets lift the US Dollar

USD/CHF extends its rally for a sixth consecutive day as Fed rate-hike expectations underpin the US Dollar.
Traders await the US PCE report due on Thursday for fresh clues on the Fed's policy path.
Uncertainty over a final US-Iran agreement continues to provide support for the safe-haven Greenback.

Vishal Chaturvedi FXStreet

The Swiss Franc (CHF) slides to its weakest level in more than ten months on Wednesday as hawkish Federal Reserve (Fed) outlook boosts the US Dollar (USD). At the time of writing, USD/CHF trades around 0.8126, extending its gains for a sixth consecutive day.

The US Dollar continues to edge higher, climbing to its highest level since May 2025. Renewed demand for the Greenback comes after the Federal Reserve delivered a hawkish hold at last week's policy meeting, where a majority of policymakers signaled that a rate hike later this year may be needed to contain inflationary pressure driven by higher energy costs.

The US Dollar Index (DXY), which tracks the Greenback's value against a basket of six major currencies, is trading around 101.36, near its highest level in over a year, since May 2025.

US Consumer Price Index (CPI) accelerated to 4.2% in May, more than double the Fed's 2% target. Attention now turns to the Personal Consumption Expenditures (PCE) Price Index report due on Thursday. Economists expect the core PCE Price Index, the Fed's preferred inflation gauge, to rise to 3.4% YoY in May from 3.3% in April.

A stronger-than-expected reading could reinforce expectations that the Fed could raise interest rates in September, with markets currently pricing in roughly a 70% probability of a rate hike, according to the CME FedWatch tool.

Meanwhile, attention also remains on the ongoing US-Iran talks. US President Donald Trump said Iran had agreed to nuclear inspections, but Tehran denied that any such commitments were made during the latest round of talks.

Until a final deal is reached, geopolitical risks are likely to remain in play, lending additional support to the safe-haven US Dollar.

Author

Vishal Chaturvedi

FXStreet

I am a macro-focused research analyst with over four years of experience covering forex and commodities market. I enjoy breaking down complex economic trends and turning them into clear, actionable insights that help traders stay ahead of the curve.

GBP/USD appears well offered near 1.3160

GBP/USD builds on Tuesday’s losses, although it now manages to pick up some pace and bounce off earlier multi-month troughs near 1.3140. The Greenback’s solid performance and continued political turmoil in the UK are keeping Cable under persistent pressure, with little sign of a meaningful recovery.

EUR/USD trims losses, hovers around 1.1350

EUR/USD now regains some composure and rebounds to the 1.1350 zone on Wednesday, partially reversing the prior pullback to fresh yearly lows near 1.1320. Meanwhile, spot remains on the back foot as the US Dollar continues to draw support from hawkish Fed expectations and uncertainty over the outcome of US-Iran peace negotiations.

Gold puts $4,000 to the test, new yearly lows

Gold accelerates its decline and gyrates around the key $4,000 mark per troy ounce on Wednesday, its lowest level since November 2025. In the meantime, tighter-for-longer Fed expectations and a broadly firmer US Dollar continue to weigh on the yellow metal, while uncertainty surrounding a potential US-Iran peace agreement has done little to revive demand for the safe haven space.

Crypto Today: Bitcoin, Ethereum, XRP trade under pressure as September Fed rate-hike odds increase

Bitcoin is trading between $62,000 and $63,000 at the time of writing on Wednesday, weighed down by headwinds stemming from macroeconomic uncertainty and geopolitical tensions in the Middle East.

5.90% to 5.45%: Why the Pound ignored the bond market’s relief rally

Keir Starmer resigned on Monday, and the Pound barely moved. That near-silence is the tell. Sterling's real driver these past four months has not been the prime minister, nor the left-leaning frontrunner lining up to replace him, but the long end of the gilt curve, which answers to a force no British politician controls.

Regime change: Inside Kevin Warsh's first move to make the Fed unreadable on purpose

The rate did not move. That was the least interesting thing about Kevin Warsh's first meeting in charge of the Fed. The FOMC held its benchmark at 3.50%-3.75% for the fourth straight meeting, exactly as priced, and then the new chair used his first press conference to dismantle the machinery the market has leaned on for a decade.