USD/CHF ATTRACTS SOME BUYERS NEAR 0.9040, EYES ON FED’S POWELL SPEECH
- USD/CHF jumps to the highest level since May 31 around 0.9040 in Tuesday’s early European session.
- Recent US ISM PMI data showed a contraction in US manufacturing sector activity for June.
- The safe-haven flows amid political uncertainty and Middle East geopolitical tensions might underpin the CHF.
The USD/CHF pair gains traction near 0.9040, the highest level since May 31 during the early European session on Tuesday. The strength of the Greenback and higher US bond yields provide some support for the pair. Investors await the speech by Federal Reserve (Fed) Chairman Jerome Powell on Tuesday for fresh impetus.
The recent weaker-than-expected US economic data triggered the expectations that the US Federal Reserve (Fed) will cut interest rates in September and December. The US Manufacturing Purchasing Managers Index (PMI) came in below the market consensus, dropping to 48.5 from 48.7 in May, the Institute for Supply Management (ISM) revealed on Monday. Traders have priced in nearly 59.5% odds of 25 basis points (bps) of a Fed rate cut in September, up from 58.2% last Friday, according to the CME FedWatch Tool.
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