USD/CHF senses resistance near 0.9140 as USD Index resumes south-side journey
31.03.2023, 01:29

USD/CHF senses resistance near 0.9140 as USD Index resumes south-side journey

  • USD/CHF has faced selling pressure near 0.9140 amid the positive market mood.
  • Investors believe that the anticipation of one more rate hike in 2023 by Fed Powell is not for May policy.
  • Swiss annual retail sales (Feb) data is expected to expand by 1.9% against a contraction of 2.2%.

The USD/CHF pair has faced tough barricades near 0.9140 in the Asian session. The Swiss Franc asset is expected to register a fresh two-week low after slipping below 0.9120 ahead. The downside bets for the major are accelerating as the US Dollar Index (DXY) has dropped after a short-lived pullback near 102.25. The downside action in the USD Index is expected to drag it below the immediate support of 102.00.

Bearish bets for USD Index are accelerating as investors believe that anticipation of one more rate hike in 2023 by Federal Reserve (Fed) chair Jerome Powell is not for May monetary policy meeting. No doubt, fears of the United States banking system crisis have ebbed significantly, and credit conditions by US banks will remain extremely tight to safeguard themselves from further casualties. Also, the impact of US banking jitters is yet to be realized ahead.

As per the CME Fedwatch tool, more than 52% chances are in favor of an unchanged monetary policy stance by the Fed for its May policy meeting.

Meanwhile, S&P500 futures have carry-forwarded optimism observed on Thursday. The 500-US stocks basket futures have added more gains in the Asian session, portraying further solidification of the risk appetite of the market participants. The demand for US government bonds is getting subdued amid an absence of clarity on the monetary policy outlook.

On the Swiss Franc front, investors are awaiting the release of Real Retail Sales (Feb) data. The annual retail sales data is expected to expand by 1.9% against a contraction of 2.2%, which would cement further scalability in the inflationary pressures. Also, the Swiss National Bank (SNB) is set on the path of bringing inflation down by hiking more rates ahead.

 

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