USD/CHF Retreats Toward 0.8200 Despite Improved Risk Sentiment

USD/CHF Slides Toward 0.8200 Despite Fading Trade-War Fears

The USD/CHF pair retreats to around 0.8210 on Monday, ending a brief two-day rally. This slide comes as the US Dollar (USD) cools off from its Friday gains, despite a solid US jobs report and waning US-China trade war concerns.

Strong US Data Supports Fed Hold

The US Nonfarm Payrolls (NFP) report on Friday showed:

• +139,000 jobs in May (vs. 130,000 expected)
• Unemployment Rate steady at 4.2%
• Average Hourly Earnings unchanged at 3.9%

This data boosted confidence that the Federal Reserve (Fed) will maintain current interest rates in the June and possibly July meetings.

SNB Rate Cut Expectations Pressure CHF

The Swiss National Bank (SNB) is under pressure after:

• Soft CPI figures
• Slower GDP growth in Q1 2025

Markets now anticipate a 25 basis point rate cut, weighing on the Swiss Franc (CHF) and potentially limiting further downside for USD/CHF.

Trade War Tensions Easing

As diplomatic talks resume, US Treasury Secretary Scott Bessent and other officials are set to meet with Chinese counterparts on Monday to de-escalate long-standing tariff disputes. This improves global risk appetite, reducing demand for safe-haven currencies like the Swiss Franc.

📌 Related article: Global Markets React to US-China Trade Developments

Technical Outlook

• Support: 0.8180, followed by 0.8135
• Resistance: 0.8250 and 0.8300

While the short-term trend favors the downside, weakening CHF fundamentals could slow bearish momentum in the coming days.

Related Articles on Tredu.com:

• US Dollar Index Outlook: Can DXY Rebound Sustain?
• What a Swiss Rate Cut Could Mean for Global FX
• How Trade War Easing Impacts Safe-Haven Flows

Key Takeaways:

• USD/CHF trades near 0.8210, down from Friday’s highs.
• Stronger US data supports Fed rate hold, helping USD.
• SNB rate cut speculation weakens CHF outlook.
• Trade talks reduce risk aversion, softening demand for CHF.