Ella 
In the Asian market on Tuesday, USD/CHF tried to recover recent losses and fluctuated higher to around 0.8620. However, USD/CHF faces challenges as US Treasury yields fall. Balance sheet improvements reported by the US have supported the price of US Treasuries, which in turn has put downward pressure on US Treasury yields.
Falling U.S. Treasury yields have played a role in continuing to strengthen U.S. Treasuries since October 2023. In addition, economic growth has also brought about an increase in tax revenue. The U.S. Treasury recently disclosed that first-quarter borrowing could be at $760 billion, down from an initial estimate of $816 billion in October.
The U.S. dollar index snapped two consecutive days of losses as concerns about possible escalating tensions in the Middle East kept the market in a risk-off mood. U.S. President Joe Biden’s administration is expected to authorize a military strike in response to a recent drone attack on a U.S. military outpost in Jordan that killed three U.S. troops and wounded at least 24 others.
Market watchers will be keeping a close eye on Tuesday’s housing price index and consumer confidence index, with the Federal Reserve seeking to provide more insight into the market situation following a statement scheduled for Wednesday, January 31.
