USD/CHF Falls Below 0.8100 as Peace Hopes Grow
The USD/CHF pair went down to nearly 0.8070 on Tuesday during the European session. This happened even though traders are hopeful about a possible peace deal between Russia and Ukraine. Normally, when the news is positive, the demand for the Swiss Franc goes down because it is a safe-haven currency.
US President Donald Trump has planned a meeting between Russian President Vladimir Putin and Ukraine’s President Volodymyr Zelenskiy. The aim is to talk about a ceasefire. Trump also said the US will support Ukraine’s security with the help of around 30 countries in a “Coalition of the Willing.”
In the US, new economic data gave strength to the Dollar. Wholesale prices increased last month, and July’s retail sales were strong. These numbers show the US economy is still strong. Because of this, traders are no longer expecting a big 50 basis-point interest rate cut from the Federal Reserve.
At the moment, the market sees about an 83% chance of a smaller rate cut in September. The next big focus is the Fed’s Jackson Hole meeting this week. If the Fed sounds soft, the Dollar may fall. If it sounds strict, the Dollar could stay strong.
Impact:
USD/CHF might stay weak if peace talks progress and the Fed hints at lower rates. But strong Fed signals could support the Dollar.
