USD/CHF inches higher to near 0.9000 on hawkish Fed members

USD/CHF faced challenges due to lower US Treasury yields on Tuesday.
Fed’s member Raphael Bostic expressed his expectation for only one rate cut this year.
Swiss Franc may cheer the risk aversion stemming from the EU’s investigations into major tech firms.

Akhtar Faruqui FXStreet

USD/CHF moves in the positive direction for the second consecutive day on Tuesday, advancing to near 0.9000 during the early European session. The US Dollar (USD) saw gains fueled by hawkish comments from US Federal Reserve (Fed) officials.

Fed members suggested that the Fed should postpone interest rate cuts, supporting the notion that interest rates should remain at their current elevated levels for a longer duration. This stance bolstered the US Dollar, as higher interest rates tend to attract more foreign capital inflows.

Atlanta Fed President Raphael Bostic expressed his expectation for only one rate cut this year, cautioning against premature rate reductions due to the potential for increased disruption. Conversely, Chicago Fed President Austan Goolsbee, aligning with the majority of the board, anticipates three cuts. However, Goolsbee underscores the need for additional evidence indicating a decline in inflation before advocating for rate cuts.

On the flip side, the Swiss Franc (CHF) may have garnered some strength due to risk aversion stemming from the European Union's (EU) initiation of investigations into major tech firms like Apple, Google, and Meta on Monday. Additionally, geopolitical tensions between Ukraine and Russia may prompt investors to seek refuge in safe-haven currencies such as the Swiss Franc (CHF).

In its March meeting held on Thursday, the Swiss National Bank (SNB) opted to cut interest rates by 25 basis points (bps) to 1.50%. This decision was driven by significant declines in both inflation and growth over the past year.

The SNB projects inflation to average 1.9% in 2024, although the current inflation rate stands notably lower at 1.2%. However, there was a substantial increase in the Consumer Price Index (CPI) in February, rising by 0.6% compared to the previous month's increase of 0.2%.

Looking ahead, the ZEW Survey Expectations for March and the SNB Quarterly Bulletin for the first quarter are scheduled for release on Wednesday. Additionally, Consumer Confidence data will be released from the United States.

USD/CHF

Overview
Today last price	0.9008
Today Daily Change	0.0014
Today Daily Change %	0.16
Today daily open	0.8994

Trends
Daily SMA20	0.8845
Daily SMA50	0.8771
Daily SMA100	0.8735
Daily SMA200	0.8817

Levels
Previous Daily High	0.8996
Previous Daily Low	0.8969
Previous Weekly High	0.902
Previous Weekly Low	0.8822
Previous Monthly High	0.8886
Previous Monthly Low	0.8553
Daily Fibonacci 38.2%	0.8986
Daily Fibonacci 61.8%	0.8979
Daily Pivot Point S1	0.8977
Daily Pivot Point S2	0.896
Daily Pivot Point S3	0.8951
Daily Pivot Point R1	0.9003
Daily Pivot Point R2	0.9013
Daily Pivot Point R3	0.903

Author

Akhtar Faruqui

FXStreet

Akhtar Faruqui is a Forex Analyst based in New Delhi, India. With a keen eye for market trends and a passion for dissecting complex financial dynamics, he is dedicated to delivering accurate and insightful Forex news and analysis.

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