USD/CHF clings to gains near 0.7930 as US Dollar trades firmly
The USD/CHF pair holds onto a two-day recovery move around 0.7930 during the late Asian trading session on Friday. The Swiss Franc pair exhibits strength as the US Dollar (USD) trades firmly after the monetary policy announcement by the Federal Reserve (Fed), in which it reduced interest rates by 25 basis points (bps) to 4.00%-4.25%.
The US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, clings to gains made in the last two trading days around 97.50 at the time of writing.
Market experts believe that the US Dollar has gained ground after the Fed’s policy announcement, following comments from Chair Jerome Powell that there is no need to cut interest rates quickly. Also, an interest rate reduction by the Fed was widely anticipated.
Meanwhile, the Fed has signaled two more interest rate cuts in the remainder of the year through its dot plot.
On the economic data front, US Initial Jobless Claims for the week ending September 12 have come in at 231K, lower than estimates of 240K and the prior reading of 264K.
In Friday’s session, investors will focus on the speech from San Francisco Fed President Mary Daly, which is scheduled at 18:30 GMT.
On the Swiss Franc (CHF) front, investors await the monetary policy decision by the Swiss National Bank (SNB), which will be announced on Thursday. The volatility in the Swiss Franc would accelerate if the SNB decides to push interest rates into negative territory. The SNB could consider negative interest rates as inflation continues to remain lower.
Source: Fxstreet.com
