USD/CHF ticks up from 0.7870 lows and consolidates above 0.7900.
Risk appetite has vanished amid the uncertainty about Iran's peace process.
On the macroeconomic front, US inflation figures will grab the focus on Thursday and Friday.
The US Dollar (USD) nudges higher against the Swiss Franc (CHF) on Thursday and consolidates above 0.7900 after bouncing from a low of 0.7870. Investors’ concerns about the fragility of the ceasefire in Iran are keeping risk appetite subdued and have provided moderate support to the safe-haven US Dollar.
A few hours after the announcement of the ceasefire, Iran closed the Strait of Hormuz as, in their opinion, Israel had violated some of the clauses of the peace proposal with a massive attack on Lebanon that killed more than 180 people.
Israel and the US affirmed that the operations against Hezbollah in Lebanon are not contemplated in the agreement, and US President Trump warned of further action if Tehran fails to comply with the deal.
The peace process remains alive
Washington and Tehran, however, seem to be moving forward with the peace process. Both countries have announced that they will send their respective delegations to peace talks in Pakistan on Saturday. Markets, however, have come to terms with the fragility of the ceasefire and are showing a moderate risk-off mood, wary that the hostilities might resume at any moment.
On Wednesday, in the US, the minutes of the last Federal Reserve (Fed) meeting showed a balanced stance, with rate cuts still on the table, but some voices raised the possibility of monetary tightening if inflation remains above the 2% target for a prolonged period.
Later on Thursday, the US Personal Consumption Expenditures (PCE) Prices Index will provide some hints about price pressures, although the main focus will be on Friday’s Consumer Price Index (CPI). The CPI will show figures from March, considered more relevant, as they reflect the impact of the war.
In Switzerland, the calendar has been thin this week. The only event worth mentioning is the March unemployment rate, which remained steady at 3%.
Comments
Log in or sign up to join the conversation.