Swiss Franc Gains as Fed Rate Hike Expectations Decrease

The Swiss Franc has gained strength against the US Dollar as market expectations for a Federal Reserve rate hike in September have decreased.

A recent analysis by CME's FedWatch tool shows that the probability of a rate increase at the Fed's September meeting is now 35%, down from 47% just one month ago.

This shift in sentiment has led to renewed weakness in the US Dollar, causing the USD/CHF pair to trade around 0.8120 during Asian hours on Wednesday.

The Swiss National Bank (SNB) has maintained its policy rate at 0% and is expected to keep it there through 2027, as inflation in Switzerland cools down to 0.4% in July.