US Dollar Snaps Losing Streak Against CHF as Oil Prices Surge

The US Dollar has snapped its three-day losing streak against the Swiss Franc, but the outlook remains fragile. Oil prices are surging amid escalating fears of global energy supply due to the Middle East crisis, which adds uncertainty to the Federal Reserve's monetary policy path.

According to recent developments, Iran warned of war expansion if the US started attacking Iranian infrastructure. This comes after US President Donald Trump stated that the US will destroy one bridge or power plant of Iran if Iran bombs a ship passing through the Strait of Hormuz.

The next major trigger for the US Dollar will be the Federal Reserve's monetary policy announcement next week, where interest rates are expected to remain unchanged. The US Dollar is heavily traded, accounting for over 88% of all global foreign exchange turnover, or an average of $6.6 trillion in transactions per day.

The most important factor impacting the value of the US Dollar is monetary policy, which is shaped by the Federal Reserve. When inflation rises above the Fed's 2% target, the Fed raises interest rates to help the USD value. However, when inflation falls below 2%, the Fed may lower interest rates, weighing on the Greenback.