- USD/CHF moves higher to near 0.7930 as the US Dollar gains in a risk-off market sentiment.
- Investors shift to the safe-haven fleet after the US struck Venezuela and captured President Nicolas Maduro.
- The major highlight of Monday will be the Swiss Real Retail Sales and the US ISM Manufacturing PMI data.
The USD/CHF pair trades 0.15% higher to near 0.7930 during the Asian trading session on Monday. The Swiss Franc pair gains as the US Dollar (USD) trades higher amid risk-off market sentiment, following the United States’ (US) strike on Venezuela and the capture of President Nicolas Maduro to face drug-trafficking charges in New York.
At the time of writing, the US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, rises 0.25% to near 98.66.
Investors brace for sheer volatility in the US Dollar this week, with a slew of US data due to be released, notably the Nonfarm Payrolls (NFP) data for December, which would not have been distorted by the government shutdown.
The US NFP data will significantly influence market expectations for the Federal Reserve’s (Fed) monetary policy action in the January meeting, given that rate cuts in 2025 were majorly driven by weakness in the job market.
In Monday’s session, investors will focus on the US ISM Manufacturing Purchasing Managers’ Index (PMI) data for December, which will be published at 15:00 GMT. The ISM Manufacturing PMI is expected to come in mildly higher at 48.3 from 48.2 in November, suggesting that activities have contracted again, but at a slightly moderate pace. A figure below the 50.0 threshold is seen as a decline in business activities.
Meanwhile, the major highlight for the Swiss Franc (CHF), this week, will be the Consumer Price Index (CPI) data for December, which will be released on Thursday. The inflation data will provide cues about whether the Swiss National Bank (SNB) will pivot to policy normalization in the near term.
On Monday, investors will focus on the Real Retail Sales data for November, which will be released at 07:30 GMT. Swiss Real Retail Sales are estimated to have grown at an annualized pace of 2.9%, faster than 2.7% in October.
