USD/CHF surges, hitting highs not seen since mid-June and testing the crucial 100-day SMA at 0.8975. The strength of USD remained persistent, largely due to elevated Treasury yields. Market still bets on a 60% probability of a Fed rate cut in September. The Swiss economic calendar remained barren during the session, leaving the pair at the mercy of broader market trends and data from the US.
Even though the market suggests a 60% probability for a Fed rate cut of 25 basis points in September as gauged by the CME FedWatch Tool, the Federal Reserve's hinted at only one cut in 2024. Fed officials, including Governor Michelle Bowman, have asserted their hawkish stance, voicing opinions that a policy rate cut, at this juncture, may be premature.
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