USD/CHF remains subdued around 0.7950 due to fading SNB's further rate cuts

• USD/CHF falters as the Swiss Franc gains strength amid waning concerns over the SNB moving rates into negative territory.
• The US Dollar may encounter pressure as the likelihood of additional Fed rate cuts in upcoming meetings increases.
• According to the CME FedWatch Tool suggests pricing in a 94% probability of a Fed rate cut in October.

USD/CHF remains subdued for the third successive session, trading around 0.7950 during the Asian hours on Tuesday. The pair loses ground as the Swiss Franc (CHF) receives support from rising inflation expectations in Switzerland, which diminishes fears of the Swiss National Bank (SNB) pushing interest rates into a negative territory.

The USD/CHF pair further depreciates as the US Dollar could face challenges amid rising odds of further Federal Reserve (Fed) rate cuts in the upcoming meetings, along with ongoing government shutdown. The CME FedWatch Tool suggests that markets are now pricing in a 94% chance of a Fed rate cut in October and an 84% possibility of another reduction in December.

The US government shutdown has postponed the key economic data release, including September's Nonfarm Payrolls report. US ADP Employment Change and Job Openings data indicate a softening labor market and strengthen expectations of an imminent rate cut.

The White House backed off US President Donald Trump's claim on Monday that government employees were already being laid off due to the shutdown but cautioned that job losses could occur as the impasse appeared likely to extend into a seventh day.

Meanwhile, the Republican-led Senate rejected competing funding measures for federal agencies for the fifth time. Democratic leader Chuck Schumer also refuted Trump's assertion that negotiations with Democrats were still taking place.