USD/CHF climbed on Friday after stronger-than-expected US employment data triggered a sharp move higher in the US Dollar. The pair jumped to 0.8126 immediately after the Nonfarm Payrolls (NFP) release before surrendering part of its gains. It was last trading near 0.8102, up approximately 0.34% on the day.
US employers added 162,000 jobs in August, significantly exceeding expectations for a 56,000 increase. Previous figures were also revised higher, with July payrolls now showing a 21,000 gain instead of the previously reported 23,000 decline. June employment growth was revised to 31,000 from 20,000. Meanwhile, the unemployment rate remained unchanged at 4.1%, matching forecasts.
The robust figures initially sent the US Dollar and Treasury yields sharply higher. The Dollar Index (DXY) climbed to 99.39 before retreating toward 99.15, highlighting some hesitation among investors despite the surprisingly strong labor-market report.
The data nevertheless strengthened expectations for Federal Reserve policy tightening at the September 15-16 meeting. CME FedWatch pricing now indicates roughly a 60% probability of a 25-basis-point rate increase, compared with around 50% before the employment figures were released.
US President Donald Trump praised the jobs report while continuing to advocate for lower borrowing costs, adding another layer of uncertainty around the Fed’s policy outlook.
Despite the strong employment figures, the Dollar has struggled to maintain its initial gains. Recent inflation data have shown signs of moderation, leaving policymakers focused on balancing employment resilience with progress toward price stability. Next week’s August Consumer Price Index (CPI) and Producer Price Index (PPI) reports will therefore be closely watched for further clues on September’s policy decision.
In Switzerland, subdued inflation continues to provide the Swiss National Bank (SNB) with room to maintain its policy rate at 0%. August consumer prices increased 0.4% month-on-month after falling 0.1% in July, while annual inflation accelerated to 0.8% from 0.4%.
Trade idea: USD/CHF remains supported above 0.8080; a move through 0.8125 could target 0.8160, while a break below 0.8080 may expose 0.8040.