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Source: Newsmaker.id
The USD/CHF pair fell to around 0.8170 during Wednesday’s Asian session (November 4), erasing most of the gains made in previous trading. This weakness follows pressure on the US dollar, as preliminary results from the US midterm elections have fueled uncertainty regarding the direction of fiscal policy in Washington.
The Democratic Party has taken control of the House of Representatives from the Republican Party. Markets are now closely monitoring potential shifts in Congressional leadership and the subsequent impact on government spending policies for the final two years of Donald Trump’s term.
Beyond political factors, investors are also weighing developments in the US-Iran conflict and the outlook for Federal Reserve policy. The market currently assigns a roughly 79% probability to a Federal Reserve interest rate hike in December; this expectation acts as a counterweight, limiting the downward pressure on the dollar.
Meanwhile, the Swiss franc has found support from domestic inflation data. Swiss inflation rose to 1.5% in October—its highest level in nearly three years. Although this remains within the Swiss National Bank’s (SNB) target range of 0%–2%, the increase has bolstered expectations that the Swiss central bank could begin raising interest rates as early as 2027.
Newsmaker Analysis: The USD/CHF pair is currently under pressure due to a post-midterm election weakening of the dollar, while the franc is supported by growing expectations regarding SNB policy. Nevertheless, the prospect of a Federal Reserve rate hike and the evolving geopolitical situation between the US and Iran could still limit further declines for the pair. (srh)
Source: Newsmaker.id