Swiss Franc ticks up, but US Dollar dips remain contained amid risk-off markets

USD/CHF nudges down from 0.8100 but maintains its near-term bullish trend intact.
Conflicting news from Iran is keeping risk appetite subdued.
Swiss trade surplus narrowed to CHF 5,224 million in June from CHF 5,989 million in May.

Guillermo Alcala FXStreet

The Swiss Franc (CHF) has trimmed some losses against the US Dollar (USD) on Tuesday, as USD/CHF bulls failed to find acceptance above the 0.8100 area. Market speculation about a ceasefire proposal in Iran has triggered a slight pullback on the US Dollar, yet dips have been shallow so far, as concerns of an all-out war are underpinning support for the safe-haven Greenback.

The US hit targets across Iran for the tenth consecutive day on Tuesday, and Tehran responded by striking US assets in Gulf countries. Reports of attacks on vessels attempting to cross the Strait of Hormuz and the announcement by the Tehran-backed Houthis of a blockade to Saudi Arabian vessels in the Red Sea are keeping Oil prices near six-week highs.

Ceasefire hopes are keeping the Swiss Franc from falling further

Meanwhile, Qatar and Pakistan keep working to reach another ceasefire. Iranian authorities affirmed on Monday that they received a proposal for another 10-day ceasefire. Axious news, on the other hand, reported that US President Donald Trump is preparing for an all-out war in case the negotiating way fails.

Earlier on Tuesday, data released by the Swiss Federal Customs Administration revealed that the Trade Balance surplus narrowed slightly in June, to CHF 5,224 million from the upwardly revised CHF 5,989 million in May.

In the US, the calendar is thin this week with only the Preliminary S&P Global Purchasing Managers' Index (PMI) release, due on Friday, worth mentioning. The US Dollar, however, maintains a moderately bullish near-term tone, buoyed by concerns that the situation in Iran escalates out of control, and market speculation that rising energy prices will force the Federal Reserve (Fed) to hike rates in September.

Economic Indicator

Trade Balance

The Trade Balance released by the Federal Customs Administration is a measure of balance amount between import and export. A positive value shows a trade surplus while a negative value shows a trade deficit. Any variation in the figures influences the domestic economy. Generally speaking, if a steady demand in exchange for Swiss exports is seen, that would turn into a positive growth in the trade balance, and that should be positive for the CHF.

AUD/USD keeps range near mid-0.7100s as USD bulls await US CPI

AUD/USD steadies near mid-0.7100s in the Asian session on Friday, stalling the previous day's sharp decline to an over one-week low. The August PPI report reaffirmed Fed rate-hike bets and boosted the US Dollar on Thursday, which weighed heavily on the pair. However, hawkish RBA expectations limited losses for the Aussie as USD bulls now await the release of the US consumer inflation figures before placing fresh bets.

USD/JPY holds lower ground toward 154.00; looks to US CPI

USD/JPY holds lower ground toward 154.00 in the Asian session on Friday after hot Japanese PPI data bolster a more hawkish BoJ repricing and provide fresh impetus to the Japanese Yen. However, the downside appears capped as the US Dollar preserves overnight gains ahead of the latest US consumer inflation data.

Gold: Gains remain capped by $4,400

Gold regains composure and trades with decent gains on Friday, managing to refocus attention on the $4,440 mark per ounce troy. Therefore, the precious metal reverses Thursday’s decline as the US Dollar alternates gains with losses at the end of the week.

Ripple Price Forecast: XRP extends decline as returning ETF inflows fail to lift outlook

Ripple (XRP) falls below $1.33 on Friday, marking the third consecutive day of declines. The token continues to track the broader cryptocurrency market downturn, with investors closely monitoring heightened macroeconomic uncertainty ahead of the United States (US) Consumer Price Index (CPI) release and next week’s Federal Reserve (Fed) monetary policy decision.

Weekly focus – The hawks set the tone

Risky assets came under pressure this week as energy prices kept creeping higher and the ECB surprised the markets with a hawkish tone. The price of Brent crude touched USD 110 per barrel on Thursday night, highest since mid-May, as news emerged that the Yemeni Houthis had reached control of key port cities and islands near the Bab el-Mandeb strait.

Venezuela’s 65-billion-barrel Oil deal could reshape America’s inflation fight

The United States (US) has secured unprecedented access to part of Venezuela’s vast Oil reserves. The timing is particularly significant as the war with Iran is disrupting Middle Eastern supplies, keeping energy prices elevated and reviving concerns about inflation.