Dollar Climbs Against Franc as Rate-Cut Expectations Recede

Key Moments

USD/CHF Supported by Firm Dollar, Fed Minutes

The USD/CHF pair trades near 0.7765 in the European session on Friday, up 0.15%. This marks its strongest level in over a week. The move reflects a firmer US Dollar, as investors respond to signals that several Federal Reserve officials are unlikely to support near-term rate cuts.

Meanwhile, the US Dollar Index (DXY), which tracks the Greenback against six major currencies, remains close to Thursday’s four-week peak of 98.00.

The Federal Open Market Committee (FOMC) Minutes from the January meeting, released Wednesday, indicate officials see no need to rush into easing. Inflation has remained above the 2% target for an extended period, reinforcing this stance.

Data Calendar and Geopolitical Backdrop

Traders are awaiting preliminary US Q4 GDP figures and S&P Global PMI data for February, scheduled during North American trading hours. These releases could influence market sentiment.

While the US Dollar has gained against the Swiss Franc (CHF), the CHF remains broadly steady. Ongoing US-Iran tensions support safe-haven demand and keep markets slightly risk-averse.

USD/CHF Technical Overview

USD/CHF is trading around 0.7765, stabilizing just above the 20-day EMA at 0.7753. The EMA has flattened after a multi-week decline, suggesting bearish pressure is easing. However, a clear trend reversal has not yet occurred.

The 14-day RSI has risen from below 30 to 49, signaling weakening bearish momentum.

A daily close above the 20-day EMA at 0.7753 would support the recovery scenario. This could encourage further buying toward the February 2 high at 0.7818. Conversely, a failure to hold this level may challenge the emerging base and revive the downtrend.