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USD/CHF trades with modest losses, around mid-0.9300s

  • USD/CHF struggled to capitalize on the overnight strong intraday positive move.
  • The CHF benefitted from reviving safe-haven demand and exerted some pressure.
  • Sliding US bond yields weighed on the USD and added to the pair’s weaker tone.

The USD/CHF pair maintained its offered tone through the early North-American session and is currently placed near the lower end of its daily trading range, around mid-0.9300s.

The pair came under some renewed selling pressure on Wednesday and eroded a part of the previous day's strong recovery move of around 170 pips amid reviving demand for traditional safe-haven currencies, including the Swiss franc.

Against the backdrop of persistent worries over the economic impact of the coronavirus outbreak, fading optimism over the US President Donald Trump's proposed fiscal stimulus measures dented the global risk sentiment on Wednesday.

The anti-risk flow was evident from weaker opening in the US equity markets and further reinforced by a fresh leg down in the US Treasury bond yields. This eventually exerted some downward pressure on the US dollar and collaborated to the downtick.

Meanwhile, Wednesday's release of the US consumer inflation figures, showing that the headline CPI edged lower to 2.3% YoY rate as compared to 2.2% expected, failed to impress the USD bulls or lend any support to the major.

It will now be interesting to see if the pair is able to attract any buying interest at lower levels or the current slide marks the resumption of the previous/well-established bearish trajectory, which dragged the pair to its lowest level since June 2015.

Technical levels to watch

 

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