USD/CHF falls to near 0.8500, Swiss Franc receives support from potential safe-haven flows
USD/CHF breaks its four-day winning streak, trading around 0.8510 during Friday’s Asian session. The Swiss Franc (CHF) receives support from the safe-haven flows amid rising Middle-East tensions. US President Joe Biden mentioned that the United States is in talks with Israel regarding potential strikes on Iran's Oil infrastructure.
Moreover, Israeli Prime Minister Benjamin Netanyahu warned that Iran "will pay a heavy price" for Tuesday’s attack, which reportedly involved the launch of at least 180 ballistic missiles at Israel, according to the BBC.
The Swiss Franc (CHF) faced downward pressure following Thursday's weaker-than-expected inflation data, which has raised the likelihood of dovish policymakers advocating for a 50 basis point rate cut by the Swiss National Bank (SNB) in December. Previously, the SNB had already lowered the key interest rate by 25 basis points for the third consecutive time.
Switzerland's Consumer Price Index rose 0.8% year-over-year in September, down from both market expectations and August's figure of 1.1%. This is the lowest inflation rate since September 2021. Additionally, the monthly inflation rate dropped by 0.3%, exceeding forecasts of a 0.1% decline, after remaining flat in August.
The US Dollar (USD) breaks its winning streak amid subdued US Treasury yields. The US Dollar Index (DXY), which measures the value of the US Dollar (USD) against its six major peers, trades around 101.90 with 2-year and 10-year yields on US Treasury bonds standing at 3.70% and 3.845, respectively, at the time of writing.
Federal Reserve Bank of Chicago President Austan Goolsbee reiterated on Thursday that the interest rates need to come down over the next year by “a lot.” Goolsbee further stated that he’d like to keep the unemployment rate at 4.2% from rising any further.
REGISTRATION LINK
