Ella 
USD/CHF is trying to halt a winning streak that started on January 11th. During Wednesday’s Asian session, the pair traded lower near 0.8690. This may be due to a slight decline in the dollar due to lower U.S. Treasury yields.
The U.S. dollar index (DXY) fell to around 103.40. As of press time, the 2-year and 10-year U.S. Treasury yields were 4.32% and 4.11% respectively. Market sentiment suggests the Federal Reserve (Fed) is less likely to cut interest rates in March. However, former St. Louis Fed President James Bullard expressed the opposite view. He expects the Fed to start cutting interest rates even before inflation reaches 2.0%, possibly as early as March.
Additionally, a 25 basis point (bps) rate cut in May is fully priced in, with a 50% chance of a 50 bps rate cut. Traders may be eagerly awaiting U.S. S&P Global Purchasing Managers Index (PMI) data due on Wednesday.
Swiss National Bank President Thomas Jordan addressed the issue of the strong Swiss franc (CHF) at an event in the Swiss town of Brig on Tuesday. He noted that the strong Swiss franc has played a role in curbing inflation. In addition, Jordan also expressed confidence in the economy, saying: “Economists believe there will not be a recession, and we are confident, otherwise we would predict a recession.” He emphasized that although a recession is not expected, But the outlook points to lackluster growth.
On the economic indicator front, Switzerland’s Federal Statistics Office reported last week that producer and import prices fell at a slower pace in December compared with November. Looking ahead, traders are eagerly awaiting next week’s release of actual retail sales and the ZEW survey – expected. The data are expected to shed further light on the Swiss National Bank’s interest rate trajectory.
