USD/CHF holds ground near 0.8250 following Trump tariffs implementation
USD/CHF remains stronger for the second successive session, trading around 0.8240 during the Asian hours on Wednesday. The US Dollar continues to gain ground against its peers, potentially due to a technical correction. However, the “Sell America’ trend may limit the upside of the Greenback and the pair.
Traders await the potential meeting of US President Donald Trump and Chinese President Xi Jinping to resolve trade disputes. Any positive development surrounding the US-China trade disputes could improve the market sentiment. However, the two world’s largest economies have recently accused each other of breaching the tariff truce reached earlier this month.
On the US data front, Job Openings and Labor Turnover Survey (JOLTS) Job Openings posted 7.39 million new positions in April, higher than March’s 7.2 million openings. This figure surprisingly came in above the market expectation of 7.1 million.
US ISM Services Purchasing Managers Index (PMI) survey results are due on Wednesday, and a slight recovery is expected in aggregate business operator sentiment. Traders will shift their focus toward the US Nonfarm Payrolls (NFP) report for May, which is expected to show 130K job additions.
However, the upside of the USD/CHF pair could be restrained as the Swiss Franc (CHF) may receive support from safe-haven flows amid growing global economic uncertainty. Trump’s double import tariff on steel and aluminum, increasing from 25% to 50%, came into effect on Wednesday at 04:00 GMT.
Data showed on Tuesday that the Swiss Consumer Price Index declined by 0.1% year-on-year in May, slipping below the Swiss National Bank’s (SNB) 0-2% target range and marking the first deflationary reading since March 2021.
Monday’s data showed that Swiss GDP grew by 0.5% quarter-on-quarter in the first quarter, improving from a revised 0.3% in Q4 of 2024. However, the Swiss economy fell short of the preliminary expectations of 0.7% growth. Traders expect the Swiss National Bank (SNB) to deliver a 25 basis point rate cut, bringing down the interest rate to 0% from the current 0.25%, with odds of moving into negative territory in the upcoming meeting.
Source: fxstreet
