USD/CHF breaks above 0.9400 to reach fresh 11-month highs

• The US dollar extends its rally to 11-month highs at 0.9425.
• A moderate risk appetite and Fed's tightening expectations are underpinning the USD.
• Above 0.9375 the pair aims to 0.9473 – Credit Suisse.

The US dollar found support at 0.9370 earlier today to resume its seven-day rally and break above 0.9400 for the first time since April 2021.

The US dollar picks up with the Fed on focus

The greenback is picking up during the US trading hours, following a weak performance on previous sessions. The positive Wall street opening seems to have spurred some dollar bids with the market awaiting the outcome of the Federal Reserve’s monetary policy meeting, due on Wednesday.

The Fed is widely expected to hike interest rates for the first time in three years, in order to tame soaring inflation levels. These hopes have pushed US treasury bonds to multi-year highs, fuelling demand for the greenback.

Furthermore, a moderate optimism about the possibility of some progress on the Russia – Ukraine peace talks seems to have triggered a cautious optimism. Comments hinting at the possibility of an agreement in the coming weeks have cheered investors, offering support to the USD/CHF.

USD/CHF above 0.9375, next target is 0.9473 ­– Credit Suisse

The FX Analysis Team at Credit Suisse, confirmation above 0.9375 would increase bulls’ confidence and clear the path towards 0.9473: “Only a sustained break above 0.9367/75 would confirm the recent strength and raise a prospect of a fresh medium-term uptrend emerging clearing the way for strength back to the 0.9473 high of last year and likely higher we think in due course.”