USD/CHF extends intraday recovery from two-week low, climbs to 0.9700 mark – by hareshmenghani USDCHF RiskAppetite Fed Bonds Currencies
A generally positive risk tone undermined the safe-haven CHF and offered support to the major.Thepair attracted some buying on Wednesday and recovered a part of the overnight heavy losses to a two-week low. Spot prices built on the steady intraday ascent through the early European session and climbed to a fresh daily high, around the 0.9700 mark in the last hour.
Despite receding bets for a more aggressive tightening by the Fed, investors seem convinced that the US central bank would deliver a larger rate hike later this year to tame inflation. The speculations remained supportive of elevated US Treasury bond yields and assisted the US dollar to stall its recent corrective pullback from a two-decade.rate hike move in July gained traction following the release of red-hot US consumer inflation figures, which accelerated to a four-decade high in June.
On the other hand, a generally positive tone around the equity markets undermined the safe-haven Swiss franc and offered some support to the USD/CHF pair. The uptick, however, lacked bullish conviction, warranting caution before confirming that the downfall from the 0.9885 region, or a multi-week high touched last Thursday, has run its course.
Market participants now look forward to the release of US Existing Home Sales data later during the early North American session. Apart from this, the US bond yields should influence the USD and provide some impetus to the USD/CHF pair. Traders will further take cues from the broader risk sentiment to grab short-term opportunities.