- USD/CHF is trading lower near 0.8875 in European markets on Monday.
- U.S. retail sales rose 0.4% in October, up from 0.8% the previous month, a stronger-than-expected increase.
- Safe-haven flows are likely to support the Swiss franc.
USD/CHF weakened to around 0.8875 in European trading on Monday, driven by a weaker dollar. Investors will be watching Swiss third-quarter manufacturing data and a speech by Federal Reserve (Fed) Chairman Austan Goolsbee on Monday.
The dollar is losing ground as Trump’s support wanes. But supportive U.S. economic data and Fed officials’ reports could limit the pair’s downside. On Friday, Boston Fed President Susan Collins said monetary policy was still limited and a December rate cut was still possible, but the final decision would depend on incoming information. At the same time, Chicago Federal Reserve President Goolsby said the market is often affected by interest rate changes and the Fed should take a slow and steady approach to reaching a neutral rate.
U.S. retail sales rose 0.4% in October, after a 0.8% increase in September (revised to 0.4%), and as of Friday, that figure beat estimates of 0.3%.
Meanwhile, continued geopolitical tensions between Russia and Ukraine could support currencies such as the Swiss franc (CHF). US President Joe Biden has authorized Ukraine to use US weapons to attack Russian territory, CNN reported on Sunday, marking a significant reversal of Washington’s policy on the Ukraine-Russia conflict, two US officials familiar with the decision said.
