- The US-China trade war truce weighs heavily on the CHF’s safe-haven status.
- A goodish pickup in the US bond yields underpin USD and remained supportive.
- Investors now eye US ISM manufacturing PMI for some short-term impetus.
The USD/CHF pair maintained its strong bid tone through the early North-American session and is currently placed at the top end of its daily trading range, around the 0.9835 region.
The global markets cheered the latest positive trade-related development over the weekend, wherein the US and China agreed to restart trade talks. The risk-on mood dampened demand for traditional safe-haven currencies – including the Swiss Franc and assisted the pair to build on last week’s modest rebound from yearly lows.
This along with the fact that investors might have been forced to scale back their expectations for an aggressive policy easing by the Fed – evident from a goodish pickup in the US Treasury bond yields, provided a strong lift to the US Dollar and further collaborated to the pair’s strong up-move on the first day of a new trading week.
Moving ahead, Monday’s US economic docket – featuring the release of ISM manufacturing PMI, will now be looked upon for some short-term trading impetus. This coupled with a slew of other important US macro data scheduled at the beginning of a new month – including the closely watched US monthly jobs report (NFP), will play a key role in determining the pair’s next leg of a directional move.
Technical levels to watch
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