Forex
Swiss Franc Surges on Weaker US Data and Waning Hike Bets
The Swiss franc has strengthened against the US dollar as weaker-than-expected US economic data led traders to scale back expectations for further Federal Reserve interest rate hikes.
The USD/CHF pair fell to a notable level, marking a significant shift in favor of the franc. This change comes after the release of specific data that came in below forecasts, suggesting the US economy may be cooling faster than previously thought.
According to CME Group's FedWatch tool, the probability of a rate hike at the next Fed meeting has dropped to a percentage from a previous percentage a week earlier. Lower rate expectations typically weaken a currency, as investors seek higher yields elsewhere.