USD Bulls Regain Ground as Fed Hopes and Iranian Tensions Fuel USD/CHF Rally

The US dollar has regained positive traction against the Swiss franc, rebounding from a one-week low and stalling its retracement slide from over a one-year high. The USD/CHF pair is climbing back above mid-0.8100s during the Asian session amid fresh US dollar buying.

Traders are pricing in a greater chance of at least one rate hike by the end of this year, driven by concerns about energy-driven inflation due to volatile oil prices. The escalation of tensions between the US and Iran has also revived demand for the safe-haven greenback.

The recent military strikes against Iran have raised worries about significant disruptions to global energy supplies, leading to a sharp rise in crude oil prices. Strategists at TD Securities argue that these disruptions are contributing to 'reduced flows and global tightening of the energy market,' which is supportive of further upside in crude oil.