USD/CHF: Is an Upward Move on the Horizon?

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Tonight, the world will witness a first: At 8:30 p.m. our time, Kevin Warsh will address the press in Washington, D.C. He will then explain the U.S. Federal Reserve’s interest rate decision for the first time in his capacity as Fed Chair. As for the decision resulting from the Federal Open Market Committee’s two-day meeting, there is little doubt: The CME FedWatch Tool indicated a probability of nearly 100% that rates would remain unchanged. This means that the Fed will leave the target range at 3.50 to 3.75%.

It therefore appears that Warsh will not be fulfilling one of Donald Trump’s most cherished wishes—at least for the time being. The U.S. president is insisting on interest rate cuts. Although he emphasized the independence of the new head of the Federal Reserve when he took office, But his harsh treatment of Powell’s predecessor, among other things, shows just how uncomfortable things can get with Trump. Former Fed Chair Jerome Powell repeatedly faced fierce attacks from the White House for his strict approach.

Focus on Communication

In any case, economists, strategists, and investors are likely to be hanging on Warsh’s every word tonight. For one thing, the markets are hoping for insights into the future direction of monetary policy in the coming months. The Fed will also release its updated projections. In addition, the focus is on overall communication. Warsh is planning reforms in this area. Among other things, he intends to be less specific about potential interest rate moves in the future. “We will not stick to past practices if we find better alternatives,” he explained in a letter to the more than 20,000 Fed employees. The new chairman wants an open debate on the central bank’s strategy and working methods.

The facts leading up to today’s decision are quite clear: On the one hand, the U.S. labor market is showing robust growth. In May, 172,000 new nonfarm jobs were created—twice as many as expected. The unemployment rate remained at a relatively low 4.3% for the third consecutive month. While the war with Iran has not yet managed to stifle job growth, the conflict is having a profound impact on inflation. Driven by high gas prices, the U.S. Consumer Price Index (CPI) in May 2026 was 4.2% higher than in the same month a year earlier. The Fed is aiming for an inflation rate of around 2% and full employment. This dual mandate is currently forcing the central bankers to more or less sit on their hands.

A bold scenario

It is even conceivable that the central bank will give the hawks some leeway and signal a tighter monetary policy. Warsh could thus take the wind out of the sails of his critics, who sometimes refer to him as Trump’s puppet. At the same time, he would appease those members of the 12-person policy committee who are already calling for a hawkish stance. For example, influential Fed Governor Christopher Waller has called it downright crazy to talk about interest rate cuts in the near future. If the hawkish narrative does indeed dominate this evening, it could give the U.S. dollar a boost. The FX pair is on the verge of this pivotal moment USD/CHF is in an intriguing position. The greenback has just bounced off horizontal resistance around CHF 0.80. The U.S. currency could also get a boost from the SNB. The National Bank will present its monetary policy assessment on Thursday morning. It is expected to maintain the zero interest rate while emphasizing its readiness to intervene in the foreign exchange market if necessary.

Investment Solution

Conclusion: The upcoming decisions could trigger a small upward move in the USD/CHF pair. Traders who consider this scenario plausible will find the mini-future S63BJU. With a current leverage of 10.7, this UBS product allows investors to participate in a strengthening of the dollar against the Swiss franc. At CHF 0.7257, the stop-loss is set 8.3% below the current exchange rate. Note: Should Warsh surprise the market with a “dovish” stance and signal a more accommodative policy in line with Donald Trump’s views, this margin could quickly narrow—and the mini-future could come under pressure as a result.