Select Language

USD/CHF extends gains, nearing 0.8200 with all eyes on the Federal Reserve   

Breaking news

USD/CHF extends gains, nearing 0.8200 with all eyes on the Federal Reserve   

  • X
  • facebook
  • LINE
  • RSS

  • X
  • facebook
  • LINE
  • RSS
New update 2025.06.18 19:14
USD/CHF extends gains, nearing 0.8200 with all eyes on the Federal Reserve   

update 2025.06.18 19:14

  • The US extends gains for the fourth consecutive day and is nearing 0.8200.
  • Fears of an escalation of the Middle East conflict are keeping the US Dollar buoyed.
  • Investors are looking at the Fed for more clues about the bank's monetary policy plans.

The US Dollar is heading higher for the fourth consecutive day on Wednesday. The pair has rallied about 1.5% from last week lows at 0.8050 to return to the upper range of the 0.8100s as the market braces for the Fed's monetary policy decision..

The Dollar has been drawing support from the risk-averse sentiment this week, in a rush for safety, with investors increasingly weary that the IS-Iran war escalates with the involvement of the US.

On Tuesday, US President Trump's comments demanding the unconditional surrender of the Iranian authorities and his veiled threats to kill the Islamic Republic's supreme leader Ali Jamenei crushed appetite for risk and sent the US Dollar higher across the board.

The Swiss calendar is void on Wednesday, and all eyes will be on the Fed's monetary policy decision, more specifically on Chairman Powell's comments and on the bank's monetary and interest rate projections.

Investors will be eager to know if the soft US data seen recently has prompted the bank to consider any further interest rate cuts over the coming months. Markets are expecting two more rate cuts this year, with the first one coming in September, and will be eager to see some confirmation of these views.

Fed FAQs

Monetary policy in the US is shaped by the Federal Reserve (Fed). The Fed has two mandates: to achieve price stability and foster full employment. Its primary tool to achieve these goals is by adjusting interest rates. When prices are rising too quickly and inflation is above the Fed's 2% target, it raises interest rates, increasing borrowing costs throughout the economy. This results in a stronger US Dollar (USD) as it makes the US a more attractive place for international investors to park their money. When inflation falls below 2% or the Unemployment Rate is too high, the Fed may lower interest rates to encourage borrowing, which weighs on the Greenback.

The Federal Reserve (Fed) holds eight policy meetings a year, where the Federal Open Market Committee (FOMC) assesses economic conditions and makes monetary policy decisions. The FOMC is attended by twelve Fed officials - the seven members of the Board of Governors, the president of the Federal Reserve Bank of New York, and four of the remaining eleven regional Reserve Bank presidents, who serve one-year terms on a rotating basis.

In extreme situations, the Federal Reserve may resort to a policy named Quantitative Easing (QE). QE is the process by which the Fed substantially increases the flow of credit in a stuck financial system. It is a non-standard policy measure used during crises or when inflation is extremely low. It was the Fed's weapon of choice during the Great Financial Crisis in 2008. It involves the Fed printing more Dollars and using them to buy high grade bonds from financial institutions. QE usually weakens the US Dollar.

Quantitative tightening (QT) is the reverse process of QE, whereby the Federal Reserve stops buying bonds from financial institutions and does not reinvest the principal from the bonds it holds maturing, to purchase new bonds. It is usually positive for the value of the US Dollar.



Date

Created

 : 2025.06.18

Update

Last updated

 : 2025.06.18

Related articles


Show more

FXStreet

Financial media

arrow
FXStreet

FXStreet is a forex information website, delivering market analysis and news articles 24/7.
It features a number of articles contributed by well-known analysts, in addition to the ones by its editorial team.
Founded in 2000 by Francesc Riverola, a Spanish economist, it has grown to become a world-renowned information website.

Was this article helpful?

We hope you find this article useful. Any comments or suggestions will be greatly appreciated.  
We are also looking for writers with extensive experience in forex and crypto to join us.

please contact us at [email protected].

Thank you for your feedback.
Thank you for your feedback.

Most viewed

Silver Price Forecast: XAG/USD steadies after three-day decline

Silver (XAG/USD) is holding firm on Thursday after a strong start to the day, recovering from a three-day losing streak as market sentiment turns cautious once again.
New
update2025.07.10 21:40

US: Initial Jobless Claims dropped to 227K last week

The US Department of Labour (DOL) reported on Thursday that the number of US citizens submitting new applications for unemployment insurance fell to 227K for the week ending July 5.
New
update2025.07.10 21:36

Gold rises for second consecutive day as trade tensions intensify

Gold (XAU/USD) is ticking up slightly on Thursday, benefiting from escalating global trade tensions as recent tariff announcements from US President Trump have rekindled investors' appetite for bullion as a traditional safe-haven asset.
New
update2025.07.10 21:03

US Dollar steady amid Trump's trade escalation, cautious Fed

The US Dollar (USD) holds its footing on Thursday after a weak start to the day, as investors digest fresh tariff threats from US President Donald Trump.
New
update2025.07.10 20:59

JPY is steady on the day - Scotiabank

The Japanese Yen (JPY) is quietly consolidating its recent pullback, attempting to find support following a poor start to July, Scotiabank's Chief FX Strategists Shaun Osborne and Eric Theoret report.
New
update2025.07.10 20:51

GBP up modestly in quiet trade - Scotiabank

The Pound Sterling (GBP) is up a modest 0.2% and outperforming most of the G10 currencies in quiet trade, Scotiabank's Chief FX Strategists Shaun Osborne and Eric Theoret report.
New
update2025.07.10 20:47

EUR/GBP wobbles around 0.8630 amid uncertainty over US-EU trade deal

The EUR/GBP pair trades in a tight range around 0.8625 during the European trading session on Thursday.
New
update2025.07.10 20:47

USD/CHF pares previous losses and returns above 0.7950 amid a stronger US Dollar

The US Dollar is featuring a moderate recovery on Thursday, paring some losses after the previous two days' reversal. The pair, however, remains trading near long-term lows, with upside attempts capped below the 0.8000 psychological level.
New
update2025.07.10 20:41

EUR consolidates in low 1.17s - Scotiabank

The Euro (EUR) is quietly consolidating in the low 1.17s and extending this week's narrow range, Scotiabank's Chief FX Strategists Shaun Osborne and Eric Theoret report.
New
update2025.07.10 20:32

CAD is little changed on the day - Scotiabank

The Canadian Dollar (CAD) remains range-bound but has made a little progress overnight, reflecting the generally softer US Dollar (USD) undertone, Scotiabank's Chief FX Strategists Shaun Osborne and Eric Theoret report.
New
update2025.07.10 20:26

Disclaimer:arw

All information and content provided on this website is provided for informational purposes only and is not intended to solicit any investment. Although all efforts are made in order to ensure that the information is correct, no guarantee is provided for the accuracy of any content on this website. Any decision made shall be the responsibility of the investor and Myforex does not take any responsibility whatsoever regarding the use of any information provided herein.

The content provided on this website belongs to Myforex and, where stated, the relevant licensors. All rights are reserved by Myforex and the relevant licensors, and no content of this website, whether in full or in part, shall be copied or displayed elsewhere without the explicit written permission of the relevant copyright holder. If you wish to use any part of the content provided on this website, please ensure that you contact Myforex.

  • Facebook
  • Twitter
  • LINE

Myforex uses cookies to improve the convenience and functionality of this website. This website may include cookies not only by us but also by third parties (advertisers, log analysts, etc.) for the purpose of tracking the activities of users. Cookie policy

I agree
share
Share
Cancel