Anna 
During the Asian session on Wednesday, the USD/CHF pair entered a bullish consolidation phase, hovering near its highest level since November 11 reached the previous day. Currently trading around the 0.9080 region, the pair appears poised to extend its recent positive momentum observed over the past month.
The Swiss Franc (CHF) continues to face pressure following the Swiss National Bank’s (SNB) unexpected decision to cut interest rates in March. The move was prompted by a faster-than-anticipated slowdown in inflation and economic growth, undermining the CHF’s strength. Conversely, as the markets scale back their expectations for rate cuts by the Federal Reserve (Fed), the US Dollar (USD) is supported. This reinforces the positive outlook for the USD/CHF pair.
Recent data releases indicate expansion in the US manufacturing sector for the first time since September 2022, coupled with ongoing elevated demand for labor. Furthermore, comments from influential Federal Open Market Committee (FOMC) members have cast doubt on the likelihood of the Fed cutting interest rates three times this year. Market pricing suggests a total rate cut of 65 basis points (bps) for 2024, lower than the 75 bps projected by the US central bank in March.
While this shift in outlook supports elevated US Treasury bond yields and limits the USD corrective decline from its recent highs, the risk-off sentiment could bolster demand for traditional safe-haven assets like the CHF, potentially acting as a headwind for the USD/CHF pair. Traders will closely monitor US macroeconomic data releases and speeches by influential FOMC members for fresh market direction.
