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USD/CHF Rises Above 0.8800 Following SNB Rate Cut

The USD/CHF Pair Rebounded Strongly On Thursday, Rises Above The 0.8800 Level. This Movement Came After The Swiss National Bank (SNB) Decided To Lower Its Benchmark Interest Rate. Despite The Gains, Traders Remain Cautious About The 200-day Simple Moving Average (SMA), A Key Resistance Level.

SNB Cuts Interest Rates By 25 Basis Points

The SNB Followed Market Expectations By Cutting Its Sight Deposit Rate From 0.50% To 0.25%. This Decision Was Based On Concerns Over Low Inflation And Economic Uncertainty. Additionally, The Central Bank Emphasized Its Readiness To Adjust Monetary Policy If Required.

As A Result, The Swiss Franc (CHF) Weakened Across The Board. The Lower Interest Rates Reduced The Appeal Of Holding CHF, Giving USD/CHF An Upward Push. Moreover, A Positive Risk Sentiment In Global Markets Further Pressured The Safe-haven CHF.

US Dollar Gains Despite Fed Holding Rates Steady

The Federal Reserve (Fed) Concluded Its Latest Meeting Without Changing Interest Rates. Policymakers Projected Only Two Rate Cuts Of 25 Basis Points By Year-end. However, The Fed Slightly Increased Its Inflation Forecast, Providing Some Support To The US Dollar (USD).

Despite This, USD Strength Remains Limited. Investors Anticipate That The Fed May Lower Rates Sooner Than Expected. Concerns About The Impact Of Tariffs Imposed By Former US President Donald Trump Also Add Uncertainty To The USD Outlook.

Geopolitical Risks And Market Reactions

Geopolitical Tensions In The Middle East Continue To Influence Financial Markets. Safe-haven Demand For CHF Could Limit USD/CHF Gains If The Situation Worsens.

Moreover, Traders Await Key US Economic Data For Further Direction. Reports On Weekly Initial Jobless Claims, The Philly Fed Manufacturing Index, And Existing Home Sales Could Impact USD Performance. If These Figures Show Weakness, The USD/CHF Pair Might Struggle To Extend Its Recovery.

Key Technical Levels To Watch

• Resistance: 0.8830 (200-day SMA), 0.8900

• Support: 0.8755 (recent Low), 0.8720

A Decisive Break Above 0.8830 Could Confirm Further Upside Potential. Conversely, A Drop Below 0.8755 May Signal Renewed Bearish Pressure.

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