The USD/CHF pair snapped its two-day winning streak on Monday, trading near 0.8210 during the early Asian session. The pair’s decline follows a mild pullback in the US Dollar (USD), despite a strong performance on Friday driven by upbeat US labor market data. The May Nonfarm Payrolls (NFP) report revealed the US economy added 139,000 new jobs, above the expected 130,000. Additionally, the Unemployment Rate remained unchanged at 4.2% and Average Hourly Earnings stayed steady at 3.9% year-on-year, both reflecting a resilient labor market.

The strong data has strengthened expectations that the Federal Reserve will likely keep interest rates unchanged in its next two meetings. However, the USD’s rally paused on Monday as markets shift focus to upcoming US-China trade talks and central bank cues.

USD/CHF’s downside may be limited due to easing trade-war tensions. A phone conversation between US President Trump and Chinese President Xi Jinping last Thursday has renewed optimism, as both sides agreed to resume negotiations. US Treasury Secretary Janet Yellen, along with other US officials, is scheduled to meet with Chinese counterparts on Monday, potentially improving global risk sentiment and boosting the US dollar.

On the Swiss side, deflationary pressures are growing. The Swiss Consumer Price Index (CPI) fell by 0.1% year-on-year in May, the first decline since March 2021 and below the Swiss National Bank’s (SNB) target range of 0–2%. Meanwhile, Swiss GDP grew 0.5% in Q1 2025, up from 0.3% in Q4 2024. Despite the growth, weak inflation data fuels expectations that the SNB may cut interest rates by 25 basis points to 0% in its June meeting.

Trade Idea:
Consider buying USD/CHF above 0.8200, targeting 0.8280–0.8320, with a stop-loss below 0.8160. Fed policy stability and easing trade tensions could support further upside.