The USD/CHF pair trades in a narrow range around the 0.7960 level during the early European session on Tuesday, with price action remaining subdued as investors position ahead of the highly anticipated US Nonfarm Payrolls (NFP) report covering October and November, scheduled for release at 13:30 GMT.
In the run-up to the employment data, the US Dollar Index (DXY), which measures the Greenback against a basket of six major currencies, remains under pressure near an eight-week low around 98.15, limiting upside momentum in the pair.
Market expectations point to a sharp slowdown in US job creation, with NFP forecast to show a gain of just 40K jobs, well below September’s 119K increase. The Unemployment Rate is seen holding steady at 4.4%. The report is likely to be a key input for the Federal Reserve’s monetary policy outlook, as recent commentary from Fed officials suggests growing concern over labor market conditions, even as inflation remains above the 2% target.
Reinforcing this narrative, San Francisco Fed President Mary Daly said on Friday that she favors interest rate cuts at the upcoming policy meeting on Wednesday, citing elevated inflation alongside a softening labor market. She warned that the Federal Reserve “cannot let the labor market falter,” according to remarks reported by Reuters.
Later in Tuesday’s session, investors will also monitor US Retail Sales data for November, along with the flash S&P Global Purchasing Managers’ Index (PMI) readings for December, which could add further volatility to USD crosses.
On the Swiss Franc side, CHF performance remains muted after the Swiss government’s latest projections pointed to a prolonged period of very low inflation. Authorities expect inflation to average just 0.2% in both 2025 and 2026, dampening expectations for near-term policy normalization by the Swiss National Bank. Inflation is seen picking up more meaningfully only in 2027, to around 0.5%. From a growth perspective, the government forecasts Swiss GDP expansion to slow to 1.1% in 2026, before accelerating to 1.4% in the following year, keeping the broader macro outlook relatively subdued.
