CHF strengthens near 0.7890 against USD despite softer inflation data reducing SNB rate hike expectations this year.
USD/CHF traded around 0.7890 in Asian hours, marking a second day of subdued movement as the Swiss Franc (CHF) gained despite cooling inflation. May’s annual inflation held at 0.6%, below the 0.8% consensus forecast, easing pressure on the Swiss National Bank (SNB) to raise rates.
Investors now expect the SNB to keep its key rate at 0% through year-end, following comments from Chairman Martin Schlegel indicating stable medium-term price pressures. Safe-haven demand for the CHF persists amid heightened geopolitical tensions, including US-Iran hostilities and warnings over the Strait of Hormuz.
Markets await the US Nonfarm Payrolls report, with projections of 85,000 jobs added in May and unemployment steady at 4.3%. Stronger-than-expected data could influence USD direction.