USD/CHF extends decline near 0.8400 as investors brace for US GDP data

• USD/CHF extends its downside around 0.8405 in Thursday's early European session. 
• Fed's dovish stance and escalating Middle East geopolitical tensions weigh on the pair. 
• The Swiss ZEW Survey Expectations came in at -3.4% in August vs. 9.4% prior. 

The USD/CHF pair remains under selling pressure near 0.8405 during the early European trading hours on Thursday. The dovish remarks from US Federal Reserve (Fed) officials continue to undermine the US Dollar (USD). 

The Fed Chair Jerome Powell said at the Fed's annual retreat at Jackson Hole last week that "the time has come" for the US central bank to cut interest rates. According to the CME FedWatch Tool, financial markets are now fully priced in a 25 basis points (bps) rate cut in September, but the chance of a deeper rate cut stands at 36.5%. 

Meanwhile, San Francisco Fed president Mary Daly said on Monday that "the direction of change is down, and the time to adjust is now." Traders widely expect the Fed to move ahead with a rate cut in September, which is likely to drag the Greenback lower in the near term. Minneapolis Fed Neel Kashkari noted it was appropriate to discuss potentially cutting interest rates from as early as September due to a weakening labor market. 

Meanwhile, the rising geopolitical tensions in the Middle East and economic uncertainties might boost the safe-haven demand, which benefits the currency like the Swiss Franc (CHF) against the USD. Israel's military launched raids and airstrikes in several parts of the occupied West Bank early Wednesday, killing at least 11 Palestinians in an offensive Israel says is its most expansive in years, per CNN. 

Data released by the Centre for European Economic Research showed on Wednesday that Switzerland's ZEW Survey Expectations came in at -3.4% in August from 9.4% in the previous reading. On Friday, the Swiss KOF Leading Indicator for August will be published. On the US docket, the US GDP Annualized is due on Thursday, which is projected to expand by 2.8% in Q2 in the second estimate.