The USD/CHF currency pair settled above Friday’s low of 0.8098, its weakest level since September 6th 2011, as escalating trade tensions and rising concerns over a wider economic fallout for the US have shaken confidence in US assets, triggering stock and bond market sell-off and supporting traditional safe haven currencies such as the Swiss Franc.
The US Dollar losses across the board came after the latest developments on the tariff front. China’s finance ministry said on Friday that it would raise tariffs on US imports to 125% from April 12th, from the previously announced 84%.
The decision was a direct response to the Trump administration’s cumulative tariff rate of 145% on Chinese imports.
“U.S. and China tariffs are now so high on one another, it’s easy to argue trade in most goods will come to a complete stall apart from essential items and those with high margins. US-China commercial flows will be in freefall casting doubt on the long-term and short-term role of the dollar,” Mizuho’s head of fixed income, currencies and commodities strategy Jordan Rochester was quoted as saying by Reuters.
The fluctuating stance on tariffs emanating from Washington has seemingly eroded confidence in the US Dollar as a reliable store of value in times of stress and led to fund flows into other markets such as the EU.
The yield on benchmark US 10-Year Treasuries settled above 4.49%, having reached 4.592% on Friday, or the highest since February 13th. The 10-year bond yield went up 49.7 basis points this week to mark the sharpest weekly increase since 2001.
According to Michael Krautzberger, Global CIO Fixed Income at Allianz Global Investors, the bond price action may be reflecting concerns that a substantial growth slowdown, or even a recession, “makes an already unsustainable U.S. fiscal outlook even worse.”
The latest macro data only added to the bleak outlook. The University of Michigan’s consumer sentiment index plummeted to its lowest level since 2022 in April, while 1-year inflation expectations rose to levels last seen in 1981.
The USD/CHF currency pair settled 1.16% lower at 0.8140 on Friday.
The major Forex pair lost 5.30% for the week.
TradingPedia.com is a financial media specialized in providing daily news and education covering Forex, equities and commodities. Our academies for traders cover 
