The pair climbs above 0.8150 as geopolitical risks and inflation concerns support USD demand despite Fed policy uncertainty.
The USD/CHF pair recovers from a one-week low, trading above 0.8150 in Asian hours as renewed USD demand offsets earlier losses. Spot prices rebound from near 0.8200, a level last tested over a year ago, driven by safe-haven flows amid escalating US-Iran tensions.
Markets remain cautious after the US launched strikes against Iran following missile attacks on US forces in the Middle East. Reports of potential Houthi fees on Red Sea shipping and ongoing standoffs over the Strait of Hormuz add to supply disruption fears, pushing crude oil prices higher. Traders now price in a higher chance of a Fed rate hike by year-end due to energy-driven inflation risks.
The pair’s recovery follows a retracement from multi-month highs, with investors balancing geopolitical risks against mixed signals from the Federal Reserve. No immediate market reaction data was provided.