USD/CHF strengthens to highs near mid-0.8300s on tariff blocking news
The USD/CHF pair regained some positive traction after the previous day’s directionless price action and surged to over one-week highs, around the 0.8345-0.8350 region during the Asian session on Thursday (May 29). Moreover, the fundamental backdrop supports prospects for an extension of the multi-day uptrend from sub-0.8200 levels, or near three-week lows touched on Monday.
The global risk sentiment got a strong boost after the Court of International Trade on Wednesday blocked US President Donald Trump’s proposed reciprocal trade tariffs. Wall Street futures and equities across Asia rose sharply in reaction to the court ruling, which in turn was seen weighing on the safe-haven Swiss Franc (CHF). This along with a strong follow-through US Dollar (USD) buying turned out to be another factor that acted as a tailwind for the USD/CHF pair.
In fact, the USD Index (DXY), which tracks the greenback against a basket of currencies, rose for the third straight day following the news of the tariff block and the aggressive FOMC Minute released on Wednesday. Federal Reserve (Fed) officials agreed to maintain a wait-and-see approach on interest rates amid uncertainty about the economic outlook and trade policy. This dampened expectations for more aggressive Fed rate cuts and continued to push the USD higher.
Source: FXStreet
