USD Falls Against CHF as Fed Hike Odds Rise Amid US-Iran Tensions
The US Dollar (USD) slipped against the Swiss Franc (CHF) on Monday as it failed to gain momentum despite stronger expectations for a Federal Reserve interest rate hike.
Fed Chair Kevin Warsh's hawkish comments at Jackson Hole last week had driven the Greenback higher, reaching its best level in over a week. However, with rising US-Iran tensions and elevated oil prices, safe-haven flows into the Swiss Franc continue to support the CHF.
The USD/CHF pair traded near 0.8080, down around 0.15% on the session, while the US Dollar Index (DXY) retreated from last week's peak of 99.72 to around 99.41.
Markets are pricing in a higher probability of a rate increase next month, with the CME FedWatch tool indicating roughly a 65% chance. This week's economic calendar is critical for USD/CHF, with US ISM PMI surveys and the Nonfarm Payrolls (NFP) report due.