USD/CHF juggles around 0.9650 as DXY turns subdued ahead of Fed policy – by Sagar_Dua24 USDCHF Fed SNB Inflation InterestRate
Labor market conditions and retail demand are supportive of a full percent rate hike by the Fed.The USD/CHF pair
is displaying a balanced profile in a narrow range of 0.9625-0.9650 in the Tokyo session. The asset is expected to display a lackluster performance as the US dollar index has turned subdued ahead of the monetary policy by the Federal Reserve . On a broader note, the asset has turned sideways after declining from 0.9680. A failed attempt to tap the two-week high at around 0.9700 pushed the asset lower.
It is worth noting that the DXY is displaying signs of momentum loss after a juggernaut rally. The DXY has been attempting to print a fresh two-week high above 110.30. However, the current structure indicates that the DXY will have to wait for more for the same as investors are looking to go light towards the mega event of monetary policy by the Fed.
As per the expectations, the Fed will announce a third consecutive rate hike by 75 basis points . However, the Fed could push the rate with a 100 bps rate hike as labor market conditions and growth rate is highly supportive. On the Swiss franc front, the interest rate decision from the Swiss National Bank will also hog the limelight. The inflation rate in the Swiss region is rising at a modest pace and has landed at 3.5% in August 2022. Considering the market consensus, SNB Chairman Thomas J. Jordan will announce a rate hike by 75 basis points , which will push the interest rates into the positive territory to 0.5%.