Usdchf Lacks Direction

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Usdchf Lacks Direction

Usd/Chf Lacks Direction Above 0.8650, Traders Await Us Retail Sales

USD/CHF is mostly flat on Thursday near the 0.8655 handle as the traders await the release of US retail sales data. It seems that everyone is waiting on the sidelines as they await the release of important economic data.

Meanwhile, DXY is seen near 103.55 with a -0.05% change for the day. This is a sign that the US Dollar has inched a little lower against other foreign currencies.

41% Chance Of 50 Bps Rate Cut

The earlier CPI report showed that inflation is smoothly heading towards the Fed's target of 2%. However, the forecasts of a deeper-than-normal rate cut from the US Federal Reserve have now eased.

CME FedWatch tool now shows only a 41% chance of a 50 bps rate cut from the US Federal Reserve in September. Earlier, the odds were nearly 50%, which shows that investors are now less sure of a rate cut.

According to Fed Bostic, more evidence is needed before the central bank moves towards lowering the rates. Meanwhile, Fed Goolsbee is worried about the US labor market, inflation, and weak employment.

Now, the traders are awaiting the upcoming release of the Initial Jobless Claims and the US retail sales. According to experts, the retail sales for July will jump by 0.3% m/m while the initial jobless claims will be around 235,000.

On the Swiss side, geopolitical tensions continue to boost the demand for CHF. That's one reason why the USD/CHF pair could turn lower in the short to medium term.

Initial jobless claims aren't as important as the US Retail sales but it will provide some insights into the US labor market.

Stronger retail sales will be a sign that the US economy is still running well despite the higher inflation and higher rates. As such, it could provide a boost to the US dollar and lower the USD/CHF pair.

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