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03/07/26
10
USD/CHF Slips as Weak US Jobs Data Hits Dollar
USD/CHF extended its decline for a second straight session and traded near 0.8020 during Asian hours on Friday, as the US dollar came under pressure following weaker-than-expected employment data from the United States. The latest figures reinforced the view that the labor market is cooling, prompting investors to reduce expectations for additional policy tightening by the Federal Reserve.
The main driver of the move was Thursday’s June Nonfarm Payrolls report, which showed that the US economy added only 57,000 jobs, far below the 110,000 increase economists had anticipated. Although the unemployment rate edged down to 4.2% from 4.3%, the sharp slowdown in hiring pointed to softer momentum across the broader economy. The release quickly shifted market pricing for the Fed’s next move.
According to the CME FedWatch tool, traders now assign a 52% probability to a September rate hike, down from 66% before the data were published. Recent comments from Federal Reserve Chair Kevin Warsh at the ECB’s Sintra conference also underscored the central bank’s commitment to its 2% inflation goal, while acknowledging that inflation pressures and expectations have moderated over the past month. That combination of softer labor data and a more balanced inflation outlook weighed on the dollar.
On the Swiss side, inflation data offered limited support for the franc but remained broadly steady. The Federal Statistical Office reported that consumer prices in Switzerland rose 0.5% year on year in June, matching forecasts but marking the weakest annual pace since March. On a monthly basis, prices were flat, below expectations for a 0.1% increase. Core inflation held unchanged at 0.3% annually.
The latest data leave USD/CHF vulnerable in the near term, with the pair continuing to reflect shifting expectations for US monetary policy and the relative stability of Swiss price pressures.
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