The Swiss franc has recently gained strength, with the USD/CHF trading at 0.9048, reflecting a decline of 0.40% [eb8242f2]. This shift comes as retail sales in Switzerland rose by 0.8% year-on-year in November, which was below the expected 1.2% and a revision from the previous month's 1.5% gain [eb8242f2]. Additionally, monthly retail sales saw a slight decrease of 0.1% [eb8242f2].
Looking ahead, Swiss inflation is projected to decline further, with December's Consumer Price Index (CPI) expected to show a decrease of -0.1% [eb8242f2]. The Swiss National Bank (SNB) is closely monitoring these inflation trends, which have remained stagnant for seven months, and there is speculation that the bank may consider lowering rates by 0.25% or even 0.50% from the current cash rate of 0.5% [eb8242f2].
In the United States, the Final Services PMI is set to be released today, with estimates suggesting an increase to 58.5 from November's 56.1 [eb8242f2]. Technical analysis indicates that the USD/CHF is testing support at 0.9047, with resistance levels identified at 0.9098 and 0.9117 [eb8242f2].
This recent data adds to the narrative surrounding the USD/CHF pair, which has been influenced by traders' bets on Federal Reserve rate cuts following the softer-than-expected June US CPI inflation report [fcf3b697]. The ongoing geopolitical tensions and political uncertainties in the US and Europe continue to bolster the Swiss franc as a safe-haven asset, despite the speculation that the SNB may cut interest rates further [fcf3b697]. Overall, the USD/CHF pair is experiencing fluctuations as traders navigate the implications of both US and Swiss economic indicators [fcf3b697].