USD/CHF trades steadily higher around 0.7950 on Monday, supported by renewed US Dollar strength as expectations of near-term Federal Reserve easing continue to diminish. Markets are shifting their focus toward key US data releases that were delayed due to the government shutdown, with the September Nonfarm Payrolls report now set for November 20. However, uncertainty lingers over additional indicators, as officials have warned that some October data may be incomplete or entirely absent.
The repricing in Fed expectations is evident, with CME FedWatch now showing just a 46% probability of a 25-basis-point rate cut in December, down sharply from 67% a week earlier. Recent comments from Fed policymakers have reinforced a cautious stance. Kansas City Fed President Jeffery Schmid described current policy as “modestly restrictive,” while St. Louis Fed President Alberto Musalem cautioned that although rates are nearer to neutral, easing prematurely could reignite inflation. This hawkish leaning has helped the Dollar stabilize across the board.
On the Swiss side, upside traction in USD/CHF may remain limited. The Swiss Franc is receiving support as markets increasingly expect the Swiss National Bank to keep rates unchanged at 0% in December, amid forecasts that inflation may tick higher. SNB Vice President Antoine Martin recently noted that consumer prices are “expected to increase slightly,” reinforcing expectations for a steady policy stance.
Additionally, CHF sentiment improved after confirmation of a revised tariff agreement between Switzerland and the United States. Washington’s decision to reduce duties on Swiss exports to 15% from 39% provides meaningful economic relief and enhances the attractiveness of the Franc during periods of global uncertainty.
Overall, the pair remains supported by shifting Fed expectations, though CHF strength and improving Swiss trade conditions could cap further gains ahead of upcoming US data.
Trade Idea:
Buy dips above 0.7920 targeting 0.8000, with stops below 0.7890. A daily close under 0.7900 would weaken bullish momentum.