USD/CHF Hits Fresh 16-Month High as US Dollar Rises on Fed Rate Hike Bets

The USD/CHF pair has hit a fresh 16-month high of 0.8327 as the US Dollar rises amid expectations of further interest rate hikes by the Federal Reserve.

The Swiss Franc, on the other hand, has weakened following the Swiss National Bank's latest monetary policy assessment, where it maintained its key interest rate at 0%.

The SNB noted that Middle East tensions continue to keep global oil prices elevated, which in turn is driving a widening yield differential between the US and Switzerland.

This has influenced capital flows between the two currencies, with analysts at Rabobank observing that speculative positioning in the Swiss Franc has shown little sign of adjustment in recent weeks.