USDCHF continues to hold 0.9400 ahead of further development on Russia-Poland tensions

• USDCHF oscillates above 0.9400 as investors look for developments on Russia-Poland tensions.
• Hawkish commentaries from Fed policymakers have failed in supporting US Treasury yields.
• SNB Jordan sees more expansion in interest rates to keep inflation in a 0-2% range.

The USDCHF pair is witnessing rangebound moves above the immediate support of 0.9400 in early Asia. The asset has been trading in a tight range as a rebound in negative market sentiment after geopolitical tensions between Russia and Poland is supporting from the floor while hawkish guidance from Swiss National Bank (SNB) Chairman Thomas J. Jordan is capping the upside.

Escalating geopolitical tensions after Russia strike two stray missiles in the region of NATO-member Poland shifted traction in favor of safe-haven assets. The US dollar index (DXY) witnessed a sheer rebound after registering a fresh three-month low at 105.34. Gains in the DXY were trimmed quickly but still have left steam for an upside.

Meanwhile, the alpha generated by the US government bonds is not reflecting any positive reaction to hawkish commentaries from Federal Reserve (Fed) policymakers. Atlanta Fed President Raphael Bostic said on Tuesday that he wasn't expecting to see the full impact of monetary policy on inflation for months, as reported by Reuters.

He further added that indicators showing ease in inflationary pressures have not been witnessed yet so anticipating more rate hikes ahead. Also, Fed Governor Lisa Cook reiterated on Tuesday that inflation in the United States is still "much too high" and added that the focus for the Fed is on addressing inflation.

On the Swiss franc front, SNB Chairman cleared that monetary policy is still expansionary and ''we have most likely to adjust monetary policy again.'' The Swiss central bank is entitled to bring the inflation rate in the 0-2% range and in response to that current monetary policy is not restrictive enough to perform the job.

Going forward, investors will keep an eye on the outcome of NATO talks over Russia-Poland tensions. Poland's government has called for a meeting with NATO ambassadors after exercising Alliance’s Article 4. The outcome of the meeting will provide a fresh impetus for further action.