- USD/CHF is trading in negative territory for the third consecutive day near 0.8460 in early Asian session on Thursday.
- Weaker US economic data and dovish Fed expectations weigh on the US Dollar.
- Lower inflation in Switzerland supports the case for another rate cut by the SNB.
The USD/CHF pair extends its decline around 0.8460 during the early European session on Thursday. Mounting speculation that the US Federal Reserve (Fed) will cut interest rate further in September is putting some selling pressure on the US Dollar (USD). Investors will focus on the release of the US ISM Services Purchasing Managers’ Index (PMI), the ADP private sector employment report and the weekly Initial Jobless Claims on Thursday, ahead of the highly anticipated Non-Farm Payrolls (NFP) for August.
Recent weaker US economic data and the Fed’s dovish stance continue to weaken the broader dollar. The US Job Openings and Labor Turnover Survey showed that available positions declined to 7.67 million in July, compared with 7.91 million openings in June, the Labor Department revealed on Wednesday. This report was worse than the estimate of 8.1 million.
Meanwhile, Atlanta Fed President Raphael Bostic said Wednesday he is ready to begin cutting interest rates even though inflation remains above the 2% target. San Francisco Fed President Mary Daly said earlier Thursday that the central bank needs to cut interest rates to keep the labor market healthy, but needs more data, including Friday’s labor market report and CPI, to determine the size of a rate cut.
On the Swiss front, inflation in Switzerland slowed more than expected in August, prompting expectations of another rate cut by the Swiss National Bank (SNB). Switzerland’s Consumer Price Index (CPI) rose 1.1% year-on-year in August, compared to the previous reading of 1.3%, below the market consensus of 1.2%. On a monthly basis, CPI inflation is unchanged in August from a 0.2% drop in July, softer than the expectation of a 0.1% increase.
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
