Ella 
USD/CHF is trading actively around 0.8840, ending a two-day losing streak in early European trading on Thursday, with a slight rebound in the U.S. dollar providing some support for the pair. Looking ahead, traders will get more clues from last week’s initial jobless claims and the Philadelphia Fed manufacturing index.
Recent dovish comments from Federal Reserve (FED) officials have raised bets on a U.S. interest rate cut in September and may limit the dollar’s upside in the short term. According to the Chicago Mercantile Exchange’s (CME) FedWatch Tool, the market is pricing in a 100% chance of the Fed cutting interest rates by at least 25 basis points (bps) in September. Federal Reserve Governor Christopher Waller said the U.S. central bank is close to cutting interest rates as long as there are no major surprises in inflation and employment data. Meanwhile, Richmond Fed President Thomas Barkin said easing on the inflation front has begun to expand and he wants to see that continue.
Earlier this week, Fed Chairman Jerome Powell said recent inflation readings “increase some confidence” that the pace of price increases is meeting the Fed’s goals in a sustainable manner. This suggests a shift toward rate cuts is imminent.
In Switzerland, safe-haven flows amid political uncertainty and geopolitical tensions could push the Swiss franc higher and bearish on USD/CHF. However, expectations that the Swiss National Bank (SNB) may cut interest rates further could weigh on the Swiss franc. Ballinger Group foreign exchange market analyst Kyle Chapman said: “I expect the Swiss National Bank to cut interest rates for a third time next quarter, if confidence in the restrictive level of monetary policy remains high, there will be A fourth rate cut is likely in December. The dovish outlook puts the Swiss franc in a weak position in the coming quarters and may hinder its further rebound, especially if the European Central Bank slowly lowers interest rates.
