USD/CHF reclaims 0.9000 as DXY rebounds ahead of Powell's testimony
- USD/CHF rose above 0.9000 during the European session.
- US Dollar Index stays in the green above 90.10.
- Eyes on FOMC Chairman Powell's testimony and US Consumer Confidence data.
The USD/CHF pair closed the first day of the week virtually unchanged at 0.8960 and moved sideways during the Asian trading hours on Tuesday. However, renewed USD strength during the European session provided a boost to the pair, which was last seen gaining 0.5% on the day at 0.9005.
Earlier in the session, the data from Switzerland showed that the Producer Price Index (PPI) in January rose 0.3% on a monthly basis, compared to analysts' estimate of 0.1%, but failed to trigger a significant market reaction.
DXY hold above 90.00
Meanwhile, the US Dollar Index (DXY) reversed its direction after dropping to a fresh multi-week low below 90.00 and helped USD/CHF move into the positive territory. At the moment, the DXY is up 0.17% at 90.17. In the absence of significant fundamental drivers, the risk-averse market environment, as reflected by a 0.5% decline in the S&P 500 Futures, seems to be helping the USD find demand.
Later in the day, the Conference Board will release the February Consumer Confidence data. Additionally, FOMC Chairman Jerome Powell will deliver his remarks on the state of the economy at his semi-annual testimony before the Senate Banking Committee.
Investors will be paying close attention to Powell's remarks on the inflation outlook and surging Treasury bond yields. If the chairman adopts a dovish tone, the greenback is likely to remain on the back foot against its rivals.
Technical levels to watch for
Author
Eren Sengezer
FXStreet
As an economist at heart, Eren Sengezer specializes in the assessment of the short-term and long-term impacts of macroeconomic data, central bank policies and political developments on financial assets.
