- USD/CHF sold off on Monday breaking below a multi-day trading range.
- Dovish Fed expectations are dragging on the USD weighing on the pair.
- The upbeat market mood could undermine the safe-haven CHF capping losses.
USD/CHF dropped below 0.91 hitting a two-week low in the European session.
After consolidating in early trade the pair came under further pressure on Monday extending its recent pullback from 0.92 USD/CHF .
The US Dollar is out of favour on speculations that the Federal Reserve could ease monetary policy further to support the US economy amid the fall out from the new COVID-19 lockdown restrictions in several US states. This is a key factor pressuring USD/CHF, although the upbeat market mood could limit losses.
The latest vaccine developments are supporting global risk sentiment. Equity markets are pushing higher as risk appetite rises. This undermines demand for the safe-haven Swiss franc, offering support to USD/CHF..
AstraZeneca announced that its covid vaccine candidate – developed with the University of Oxford was up to 90% effective if patients were given a half dose, followed by a full dose.
Looking ahead the US Manufacturing and Services PMI prints for November will be in focus. The data and broad risk sentiment could drive the USD.
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