The USD/CHF pair rebounded to 0.8955, breaking a two-day decline during the early European session on Monday, bolstered by a stronger US Dollar (USD). Market focus later in the day shifts to key economic indicators and a speech from Fed‘s Mary Daly.
The US Producer Price Index (PPI) for June exceeded expectations, showing a year-on-year increase of 2.6%, up from 2.4% previously, with the core PPI rising to 3.0%, surpassing forecasts of 2.5%. This data supported the USD against the Swiss Franc (CHF).
Conversely, the University of Michigan’s Consumer Sentiment Index dropped to 66.0 in July, its lowest in seven months, missing expectations of a rise to 68.5. Despite this, expectations for US Federal Reserve (Fed) interest rate cuts starting in September remain strong, with financial markets pricing in over a 90% probability of a rate cut.
The attempted assassination of former US President Donald Trump over the weekend adds to market uncertainty, potentially increasing safe-haven flows benefiting the CHF. Trump was injured during a rally in Pennsylvania, which resulted in casualties and heightened geopolitical tensions.
Investors will closely monitor upcoming Swiss Producer and Import Prices data, alongside US economic indicators and Fed commentary, for further insights into market direction and currency movements.
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