USD/CHF oscillates in a narrow range above the 0.8770 mark ahead of the Swiss CPI

• USD/CHF remains confined in a tight range between 0.8770 and 0.8780 ahead of the Swiss inflation data.
• The number of employed people in the US private sector rose by 324K, above estimates of 189K.
• Fitch downgraded the US government's credit rating from AAA to AA+, fueling concern about the US debt ceiling crisis.
• Investors await the Swiss Consumer Price Index (CPI), the US weekly Jobless Claims and Unit Labor Cost.

The USD/CHF pair consolidates in a narrow range above 0.8770 in the early Asian session after retreating from the key barrier around 0.8800. The solid US ADP Employment Change lifts the Greenback. The US Dollar Index (DXY), a measure of the value of USD against six other major currencies, surges to its highest level since July 7 at 102.80 in response to the news.

That said, Automatic Data Processing Inc. (ADP) revealed on Wednesday that the number of employed people in the US private sector rose by 324K, above estimates of 189K and lower than the revised reading of 455,000 in June. This figure is above the 12-month average. Investors speculate on a more aggressive Federal Reserve (Fed) stance, which benefits the US Dollar and acts as a tailwind for the USD/CHF pair. 

On the other hand, markets turned cautious after Fitch downgraded the United States government's credit rating from AAA to AA+. The leading rating company cited an expected fiscal deterioration over the next three years and a high general government debt burden as the primary reasons for this drastic action.

US Treasury Secretary Janet Yellen said late Wednesday that Treasury securities remain the world's most secure and liquid asset and that the US economy is fundamentally robust, per Reuters. Additionally, White House (WH) Economic Adviser Jared Bernstein expressed confidence in the US government and Congress to avoid default, and the US Treasury debt remains the safest in the world. However, this headline fuels concern about the US debt ceiling crisis and might cap the upside in the Greenback. This, in turn, might benefit the Swiss Franc, a traditional safe-haven asset.

Looking ahead, market participants await the Swiss Consumer Price Index (CPI) YoY for July. Also, investors will take cues from more US employment data. The US weekly Jobless Claims and Unit Labor Costs are due later in the day. The highlight of the week is the US Nonfarm Payrolls on Friday. The economy is expected to have created 180,000 jobs in July.