Usdchf Struggles After Us Cpi

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Usdchf Struggles After Us Cpi

USD/CHF Struggles Near 0.8930 After US CPI

After staging impressive gains for 2 days in a row, it appears that the USD/CHF bulls have run out of luck. In Thursday's session, the USD/CHF finally reversed directions amid a weaker DYX (Dollar index).

For now, the USD/CHF trades around the 0.8930 level and has already lost 0.10% of its value in a single day. Similarly, the DYX is also on the back foot near the 104.65 after dropping from the 104.96 level.

The latest catalyst that sent the USD/CHF was the US CPI, which increased by 0.6% month-over-month. Similarly, the annual CPI was 3.7% against the 3.2% expected reading.

Little To No Chance Of Rate Hike In September

The real reason behind the weakness in the greenback is the fact that there's little chance of a rate hike at the upcoming meeting. But this also means that there's a chance of a pick-up in inflation in the months ahead. For the September meeting, the chances of no rate hike are now standing at 97%. For November, the odds are 49.2%, which suggests that there's enough chance for a rate hike.

For the most part, there's little to no data coming out of Switzerland. In other words, the data coming out of the USA will be driving the USD/CHF trading pair.

Furthermore, the US & China trade relations are not ideal, which is also an important factor behind the bearish moves in the USD. As a result of this, the USD/CHF is going down, which is an indication of the CHF's strength against its competition.

We also have the Import prices and the Swiss producer index due later today, which will provide some insight into the Swiss economy.

However, the main catalyst is most definitely the CPI reading, the interest rate decision that continues to weigh heavily on the USD/CHF pair. But if we look at the bigger picture, the USD is still positive against most of its peers despite the sell-off in shorter timeframes.

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