USD/CHF rallies to 0.7975 area as markets turn cautious

• The US Dollar appreciates to 0.7975 but remains within the last six weeks' range, below 0.8000.
• Political and fiscal uncertainty is providing a fresh impulse to the safe-haven Dollar this week.
• In Switerlan, higher unemployment and low inflation figures are weighing on the CHF.

The US Dollar has accelerated its rebound from Monday's lows at the 0.7940 area, reaching intra-day highs at 0.7975 so far. However, the pair remains trapped within the horizontal range of the last six weeks, below the 0.8000 psychological level.

The Greenback is outperforming its peers on Tuesday as markets turn cautious and speculative investors flock to the safety of the USD amid growing political and fiscal concerns in Japan and the Euro Area.

In France, Prime Minister Lecornu's resignation revived concerns about the country's boosting fiscal debt and undermined investors' confidence in the Euro. In Japan, the "Takaishi Trade" has hammered the Yen amid expectations that the new prime minister will hamper the BoJ's monetary tightening plans.

In Switzerland, recent data revealed that the Unemployment Rate ticked up to 3% from 2.9% in September, adding to evidence of the negative impact of Trump's tariffs. Speculation about negative SNB interest rates has receded, but the low inflation levels remain a serious concern and a weight for further CHF recovery.

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