Swiss Inflation Rises, CHF On
USD/CHF weakened for a third day, hovering around 0.7950 during the Asian session. The Swiss franc received a boost from rising domestic inflation expectations, alleviating concerns that the SNB would need to push interest rates into negative territory. Consequently, demand for the CHF strengthened, putting pressure on the pair.
Meanwhile, the US dollar was pressured by the increasing likelihood of a Fed rate cut at its upcoming meeting, coupled with the ongoing government shutdown. CME FedWatch estimates a 94% chance of a 25 bps cut in October and an 84% chance of an additional cut in December. The shutdown also delayed the release of key data such as the September NFP, making the market more sensitive to alternative signals.
On the news front, the White House denied claims of layoffs due to the shutdown but warned that they could occur if the deadlock continues into a seventh day. At the Capitol, the Republican-led Senate again rejected a funding package, while Chuck Schumer denied any negotiations with Democrats. This mix of policy and political factors maintains high uncertainty—a backdrop that tends to support the CHF and restrain USD/CHF rallies. (az)
Source: Newsmaker.id
