Swiss Franc Weakens as US Inflation Data Looms
The Swiss Franc has weakened against its major currency peers during the European trading session on Wednesday. As of writing, USD/CHF is trading at a 0.17% higher price point around 0.8125. The US Dollar Index (DXY) also trades marginally higher to near 99.88.
Investors are closely tracking the upcoming US Consumer Price Index (CPI) data, scheduled for release at 12:30 GMT. A soft inflation reading could weigh on the Dollar's value and influence the Federal Reserve's monetary policy outlook.
Analysts at ING expect a reasonably subdued set of numbers from the CPI data, with consensus looking for a 0.1% month-on-month increase in headline and core inflation rates. This would see year-over-year rates drop to 3.4% and 2.5%, respectively, inching closer to the Fed's 2% inflation target.
ING highlights that lower gasoline prices, broadening signs of rental deflation, and soft wages are expected to drive the softer readings. If the market is expecting a softer price story today, investors would probably need to see a 0.1% month-on-month read on core inflation to materially shift the policy narrative.