The USD/CHF pair continued its downtrend for the third straight session, trading around 0.8880 during European hours on Wednesday (05/03). The pair remained under pressure after the release of Swiss Consumer Price Index (CPI) data.

The monthly CPI rose by 0.6% in February, marking the first increase in nine months and the fastest pace since February 2021, surpassing market expectations of 0.5%. The annual inflation rate eased slightly to 0.3% in February, beating the expected increase of 0.2% but down from 0.4% in January, marking the lowest level since April 2021. Meanwhile, core inflation—which excludes volatile items such as unprocessed food and energy—held steady at 0.9%, unchanged from January.

Additionally, the USD/CHF pair depreciated as the US Dollar (USD) struggled amid growing concerns over slowing US economic growth. Investors now turn their attention to key US economic data, including the ISM Services PMI and ADP Employment Change, due later in the North American session.

President Trump's 25% tariffs on Canadian and Mexican goods came into effect on Tuesday, along with a hike in tariffs on Chinese imports to 20%. However, market sentiment weighed on the USD amid speculation that Trump could soften his stance on tariffs.

US Commerce Secretary Howard Lutnick suggested in an interview with Fox News that Trump could reconsider the tariffs less than 48 hours after they were implemented, indicating potential relief if the USMCA rules were followed. However, the New York Times reported that Trump has privately stated his intention to keep the tariffs in place. (Newsmaker23)

Source: FXstreet