USD/CHF trades with mild losses near 0.9020 during the early European session on Tuesday, as a broadly weaker US Dollar (USD) drags the pair lower. The US Dollar Index (DXY), which measures the USD’s value against six major currencies, slips to around 107.25 as traders continue to price in the possibility of two 25-basis-point rate cuts by the Federal Reserve (Fed) before the end of the year. This dovish outlook puts pressure on the Greenback against the Swiss Franc (CHF).

Market participants will take cues from the US ISM Manufacturing PMI report due later on Monday. On Friday, focus will shift to the ISM Services PMI data, which could influence USD price action.

Meanwhile, geopolitical tensions provide support for the safe-haven Swiss Franc. The ongoing Russia-Ukraine conflict remains a key driver of risk sentiment. Over the weekend, US President Donald Trump criticized Ukrainian President Volodymyr Zelenskyy as “disrespectful” and canceled a minerals deal that could have strengthened Ukraine’s economic position. The uncertainty surrounding these developments continues to push investors toward safe-haven assets like the CHF.

Trade Idea:
Sell USD/CHF near 0.9030, targeting 0.8980, with a stop-loss at 0.9060. Increased geopolitical risks and Fed rate cut expectations could push the pair lower.