- USD/CHF grinds higher after positing the first daily gains in three.
- US policymakers’ discussion on bank deposit insurance allows markets to remain optimistic.
- Yields rebound amid hawkish Fed bets, mixed feelings about banking sector fallout.
- Swiss trade numbers, US housing data can entertain intraday traders.
USD/CHF picks up bids to refresh intraday high as it extends the previous day’s gains, the first in three, to 0.9300 during early Tuesday morning in Europe.
The Swiss Franc (CHF) pair’s latest rebound could be linked to the US Dollar’s corrective bounce off the five-month low amid hawkish Fed bets. However, cautious optimism surrounding the latest banking industry updates, following a debacle in the US and Europe.
US Dollar Index (DXY) bounces off the lowest levels since early February, marked the previous day, while snapping a three-day downtrend, mildly bid around 103.40 by the press time. In doing so, the greenback’s gauge versus the six major currencies traces the late Monday’s recovery in the US Treasury bond yields, as well as the hawkish Fed bets, to tease buyers ahead of the key Federal Open Market Committee (FOMC) Monetary Policy Meeting, up for release on Wednesday.
That said, the Treasury bond yields remain inactive but keep the previous day’s bounce off multi-day low as the US 10-year and two-year Treasury bond yields recovered from the lowest levels since September 2022 on Monday. Furthermore, CME’s FedWatch tool mentions the probability of witnessing a 0.25% Fed rate hike on Wednesday as near 75%, up from the last week’s 65%.
Alternatively, a headline from Bloomberg suggests relief for the traders amid the impending banking crisis, which in turn challenges the US Dollar’s haven demand and may test the USD/CHF upside. “US officials are studying ways they might temporarily expand Federal Deposit Insurance Corporation (FDIC) coverage to all deposits, a move sought by a coalition of banks arguing that it’s needed to head off a potential financial crisis,” reported Bloomberg. The news quotes anonymous people with knowledge of the talks saying, “Treasury Department staff are reviewing whether federal regulators have enough emergency authority to temporarily insure deposits greater than the current $250,000 cap on most accounts without formal consent from a deeply divided Congress.”
It should be noted that the fears of the FDIC’s inability to cover the US bank deposits, due to the limitations of funds in the reserve, join the doubts surrounding the UBS-Credit Suisse deal to probe the risk-on mood amid a sluggish Asian session.
Amid these plays, S&P 500 Futures print mild gains to portray cautious optimism.
Looking ahead, February month trade numbers from Switzerland will precede the US second-tier housing data to entertain intraday USD/CHF traders. However, major attention will be given to the Fed versus Swiss National Bank (SNB) play as the latter previously advocated policy pivot.
Technical analysis
A two-week-old descending resistance line challenge USD/CHF bulls around 0.9300.
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

EUR/USD tests daily lows near 1.0350 on NFP
The buying bias in the Greenback gathers extra pace on Friday after the US economy created fewer jobs than initially estimated in January, dragging EUR/USD to the area of new lows near 1.0350.

GBP/USD flirts with daily lows near 1.2420, Dollar picks up pace
The continuation of the rebound in the US Dollar motivates GBP/USD to accelerates its losses and revisit the 1.2420 area, or daily lows, following the release of US NFP in January.

Gold tests fresh lows near $2,860 after NFP
Gold prices trim their early advance on Friday, deflating to the vicinity of the $2,860 region per ounce troy following the publication of the US labour market report in January.

Key takeaways from the January Payrolls report
The January payrolls number was weaker than expected at 143k, vs a reading of 175k. However, to counteract the downside surprise in the NFP number, the unemployment rate fell to 4% from 4.1%, and average wage data jumped by 0.5% on the month, to 4.1%, the market had been looking for a decline to 3.8%.

Top Trumps: The global economy’s House of Cards
The year has barely started and we are learning the hard way what Donald Trump’s second term in office means for markets, analysts and global policymakers. It's like living through an episode of the political thriller, House of Cards.

The Best Brokers of the Year
SPONSORED Explore top-quality choices worldwide and locally. Compare key features like spreads, leverage, and platforms. Find the right broker for your needs, whether trading CFDs, Forex pairs like EUR/USD, or commodities like Gold.