USD/CHF surges to near 0.8960 after SNB announced a 25 bps interest rate cut

USD/CHF gains ground on SNB’s decision to reduce interest rates by 25 bps on Thursday.
The Swiss National Bank (SNB) has opted to reduce interest rates in response to significant declines in both inflation and growth over the past year.
Fed projects a higher long-term policy rate through December, increasing to 2.6% from the previous projection of 2.5%.

Akhtar Faruqui FXStreet

USD/CHF has rebounded from intraday losses and shifted into positive territory following the Swiss National Bank's (SNB) decision to cut interest rates by 25 basis points (bps) to 1.50% in its March meeting held on Thursday. As a result, the USD/CHF pair trades higher around 0.8960 during the European session.

SNB has reduced interest rates due to substantial declines in both inflation and growth over the last year. The Swiss National Bank (SNB) projects inflation to average 1.9% in 2024. Currently, the inflation rate is notably lower than this forecast, standing at 1.2%. However, there was a significant increase in the Consumer Price Index (CPI) in February, rising by 0.6% compared to the previous month's increase of 0.2%.

The Federal Reserve is now projecting a higher long-term policy rate through December, ticking up to 2.6% from 2.5%. However, despite the Fed's optimistic growth expectations, markets are seemingly shrugging off these projections, leading to a decline in the value of the US Dollar (USD).

The US Dollar Index (DXY) hovers around 103.30, mainly influenced by weaker US Treasury yields. Yields for the 2-year and 10-year bond coupons have fallen to 4.59% and 4.25%, respectively. This decline is attributed to the US Federal Reserve's (Fed) reaffirmation of expectations for three interest rate cuts this year.

Even though the Federal Open Market Committee (FOMC) projects stronger growth throughout 2024 and 2025 than initially anticipated, investor sentiment indicates expectations of additional easing measures in 2024.

USD/CHF

Overview
Today last price	0.8869
Today Daily Change	0.0000
Today Daily Change %	0.00
Today daily open	0.8869

Trends
Daily SMA20	0.8818
Daily SMA50	0.8744
Daily SMA100	0.8735
Daily SMA200	0.8816

Levels
Previous Daily High	0.8919
Previous Daily Low	0.8859
Previous Weekly High	0.8853
Previous Weekly Low	0.8747
Previous Monthly High	0.8886
Previous Monthly Low	0.8553
Daily Fibonacci 38.2%	0.8882
Daily Fibonacci 61.8%	0.8896
Daily Pivot Point S1	0.8846
Daily Pivot Point S2	0.8823
Daily Pivot Point S3	0.8786
Daily Pivot Point R1	0.8905
Daily Pivot Point R2	0.8942
Daily Pivot Point R3	0.8965

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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