- USD/CHF is hovering around 0.9335 as the chances of a 75 bps rate hike have trimmed.
- The Swiss franc is underperforming on flat jobless rate and CPI numbers.
- The Fed has already hiked its rates by 75 bps in the last two monetary policies.
The greenback bulls are taking some rest after a juggernaut rally from a low of 0.9709, recorded last week. The USD/CHF pair has witnessed a sheer upside move right from the initial trading session of April. The momentum remained continued in the asset amid broader strength in the US dollar index (DXY) backed by a shift in the focus from releasing helicopter money to liquidity tightening policy.
The Federal Reserve (FED) has chosen the path of liquidity contraction from the economy to tame the galloping inflation. To address the same, the Fed has already hiked its interest rates by 75 basis points (bps) in the last two monetary policy announcements. Recently, investors were expecting a 75 bps rate hike in one go by the Fed in June’s policy. This triggered a negative market sentiment and investors were dumping the risk-sensitive currencies.
However, Atlanta Fed President Raphael Bostic has shrugged off the expectations of a 75 bps rate hike after stating that the Fed's most recent 50 bps rate hike was an "aggressive" move and that the Fed can stay at this pace.
Meanwhile, the demand for the Swiss franc has been dented after the economy reported flat Unemployment Rate and Inflation numbers last week. The former landed at 2.2% while the latter printed at 2.5%, both in line with the market consensus.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
USD/JPY jumps above 156.00 on BoJ's steady policy
USD/JPY has come under intense buying pressure, surging past 156.00 after the Bank of Japan kept the key rate unchanged but tweaked its policy statement. The BoJ maintained its fiscal year 2024 and 2025 inflation forecast, disappointing the Japanese Yen buyers.
AUD/USD consolidates gains above 0.6500 after Australian PPI data
AUD/USD is consolidating gains above 0.6500 in Asian trading on Friday. The pair capitalizes on an annual increase in Australian PPI data. Meanwhile, a softer US Dollar and improving market mood also underpin the Aussie ahead of the US PCE inflation data.
Gold price keeps its range around $2,330, awaits US PCE data
Gold price is consolidating Thursday's rebound early Friday. Gold price jumped after US GDP figures for the first quarter of 2024 missed estimates, increasing speculation that the Fed could lower borrowing costs. Focus shifts to US PCE inflation on Friday.
Stripe looks to bring back crypto payments as stablecoin market cap hits all-time high
Stripe announced on Thursday that it would add support for USDC stablecoin, as the stablecoin market exploded in March, according to reports by Cryptocompare.
US economy: Slower growth with stronger inflation
The US Dollar strengthened, and stocks fell after statistical data from the US. The focus was on the preliminary estimate of GDP for the first quarter. Annualised quarterly growth came in at just 1.6%, down from the 2.5% and 3.4% previously forecast.