USD/CHF rises on safe-haven USD demand while SNB outlook limits CHF downside

USD/CHF rises as demand for safe-haven assets strengthens amid geopolitical tensions.
The US Dollar benefits from defensive flows despite mixed US economic signals.
Swiss National Bank outlook limits downside potential for the Swiss Franc.

Ghiles Guezout FXStreet

USD/CHF trades around 0.7840 on Monday, up 0.28% on the day, supported by a renewed wave of risk aversion that is boosting the US Dollar (USD). Concerns over a potential escalation in the Middle East dominate market sentiment following conflicting reports about an incident involving a US warship in the Strait of Hormuz. Although some US sources denied a direct missile strike, the lingering uncertainty is prompting investors to reduce exposure to riskier assets.

Tensions escalated after Iran’s Fars news agency reported that two missiles targeted a US warship near the Strait of Hormuz, after it allegedly ignored Tehran’s warnings. The incident comes in an already sensitive context, following a US plan to secure navigation through the area.

However, US officials denied any direct strike, while Iranian sources suggested it was a warning shot with no confirmed damage. This uncertainty is keeping markets on edge, especially as Iran warned that any US incursion would be considered a violation of the ceasefire.

The US Dollar is benefiting from these defensive flows, gaining against its major peers. The rise in Oil prices, driven by these geopolitical tensions, is also reinforcing the move, as investors anticipate possible disruptions to global energy supply.

In this context, traders remain cautious ahead of key US data releases, notably the ADP Employment Change report and, above all, Friday’s Nonfarm Payrolls (NFP). These figures, along with speeches from several Federal Reserve (Fed) officials, are expected to provide further clarity on the monetary policy outlook following last week’s hawkish tone.

On the Swiss side, the Swiss Franc’s (CHF) fundamentals remain solid, limiting its downside against the Greenback. Recent data showed an improvement in manufacturing activity, with the SVME Manufacturing Purchasing Managers Index (PMI) rising to 54.5 in April. However, according to Commerzbank, the Swiss National Bank (SNB) has limited room to sustainably weaken the currency. The bank notes that large-scale interventions would be required to influence the Swiss Franc’s trajectory, an option seen as unlikely due to balance sheet risks and political constraints.

Therefore, while the US Dollar is currently supported by safe-haven demand, the Swiss Franc's structural resilience could cap further upside in USD/CHF in the short term.

US Dollar Price Today

The table below shows the percentage change of US Dollar (USD) against listed major currencies today. US Dollar was the strongest against the Australian Dollar.

	USD	EUR	GBP	JPY	CAD	AUD	NZD	CHF
USD		0.17%	0.27%	0.06%	0.17%	0.31%	0.24%	0.30%
EUR	-0.17%		0.07%	-0.11%	0.00%	0.14%	0.07%	0.12%
GBP	-0.27%	-0.07%		-0.19%	-0.06%	0.08%	-0.01%	0.07%
JPY	-0.06%	0.11%	0.19%		0.08%	0.19%	0.13%	0.18%
CAD	-0.17%	-0.01%	0.06%	-0.08%		0.12%	0.04%	0.12%
AUD	-0.31%	-0.14%	-0.08%	-0.19%	-0.12%		-0.09%	-0.03%
NZD	-0.24%	-0.07%	0.01%	-0.13%	-0.04%	0.09%		0.07%
CHF	-0.30%	-0.12%	-0.07%	-0.18%	-0.12%	0.03%	-0.07%

The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).

Author

Ghiles Guezout

FXStreet

Ghiles Guezout is a Market Analyst with a strong background in stock market investments, trading, and cryptocurrencies. He combines fundamental and technical analysis skills to identify market opportunities.

GBP/USD trims gains; back to 1.3450-ish

The persistent weakness hurting the Greenback lends support to the British Pound and the rest of the risk-linked assets, sending GBP/USD to new two-day tops past 1.3480 on Wednesday. Indeed, Cable advances for the second day in a row helped by the constant optimism around a potential US-Iran deal.

EUR/USD hovers around two-month peaks near 1.1560

EUR/USD advances for the second day in a row, challenging multi-week highs in the 1.1560 zone on Wednesday. The persistent weakness hitting the US Dollar underpins the move higher in spot while market participants continue to closely follow developments from the Middle East and gear up for upcoming key data releases in the US jobs market. On Thursday, all the attention will be on the release of weekly Claims alongside Challenger Job Cuts.

How Wall Street rigs the game [Video]

In this week’s Live from the Vault, Andrew Maguire is joined by Peter Antico and Sean Stone to discuss the Paradigm of Money - an in-depth expose of financial market corruption, from naked shorting to the two-tier system that protects Wall Street.

Bitcoin stalls despite strong market activity across traditional assets

Bitcoin (BTC) remained subdued while stocks edged higher and gold lower, suggesting the market is trapped between weakening institutional demand and growing signs of seller exhaustion, according to a Glassnode report on Wednesday.

Why the WTI sell-off may be hiding a supply warning

Prices for the barrel of the American Oil benchmark have fallen sharply as hopes of a US-Iran agreement have resurfaced, but a deeply backwardated Oil curve, tight Cushing stocks and light speculative positioning all warn that the sell-off may have gone too far.

9-3: Is the Federal Reserve’s vote tally Warsh's new forward guidance?

The rate did not move. Neither did the statement, and that’s the more interesting fact. Set the July 29 Federal Open Market Committee (FOMC) statement beside the one issued on June 17, and the two documents are identical apart from a single verb and a paragraph at the bottom naming three dissenters.