USD/CHF finds some support above 0.9100 amid the cautious mood, geopolitical tensions eyed

The USD/CHF pair faces some selling pressure to 0.9105 on Wednesday during the early European session. The downtick of the pair is supported by the decline of the US Dollar Index (DXY) to 106.20. Additionally, the ongoing geopolitical tensions in the Middle East continue to support the Swiss Franc (CHF), a traditional safe-haven currency. 

Late Tuesday, National Security Advisor Jake Sullivan said that new sanctions targeting Iran and sanctions against entities supporting the Islamic Revolutionary Guard Corps and Iran's Defense Ministry will be imposed in the coming days. Sullivan added that these new measures will "continue a steady drumbeat of pressure" to contain and degrade Iran's military capacity and effectiveness and confront the full range of its problematic behaviors. Meanwhile, western leaders have urged Israel to exercise restraint against escalation. Market players will closely monitor the development surrounding Israel and Iran tensions. Any escalating tensions might boost safe-haven assets like CHF and create a headwind for the USD/CHF pair. 

On the other hand, strong US economic data and hawkish comments from the US central bank remain to support the Greenback for the time being. The Federal Reserve's Jerome Powell stated that the US economy has not seen inflation come back to the 2% target and that monetary policy needs to be restrictive for longer. These remarks further dampen investors' hopes for meaningful rate cuts this year and lift the USD against its rivals. According to the CME FedWatch Tool, financial markets have priced in 67% odds that the Fed will cut interest rates in September.