Losses in Europe were reversed as USD/CHF reclaimed its intraday high at 0.8855. The US Dollar recovery and Swiss GDP for Q2 2023 were examined for the Swiss Franc pair. Prior to important data, the US Dollar Index (DXY) showed modest gains at 104.25, following stronger US Treasury bond yields. The positive US jobs report from Friday, the Fed’s hawkish remarks, and China’s challenges to confidence could all be factors in the US Dollar’s recovery.

Despite the fact that concerns about the policy pivot persist about the unemployment rate and average hourly earnings, the US Nonfarm Payrolls (NFP) has reiterated its hawkish bias towards the Fed. Moody’s increased its 2023 GDP forecast from 1.1% in May to 1.9%. President of the Federal Reserve Bank of Cleveland, Loretta J. Mester justified the institution’s hawkish action, arguing that recent odds favoring a rate hike in late 2023 contrast with the market’s expectations in September that the Fed would maintain its current policy. Sino-American tensions over Taiwan, the market’s lack of faith in Chinese attempts to defend the economy, and the unease of US companies in Beijing have all driven market sentiment and supported the US Dollar.

Swiss Q2 GDP growth slowed to 0.0% QoQ and 0.5% YoY from 0.3% and 1.5% priors. The USD/CHF run-up appears reasonable, but it’s crucial to monitor US Factory Orders for July, China news, and Fed concerns for clear indications.

Technical examination
Until they see a definite downside break of the six-month-old prior resistance line, which is currently support near 0.8810, USD/CHF purchasers are still optimistic.

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