USD/CHF off 1-week peak on higher chances of Harris victory

The USD/CHF currency pair extended a pullback from recent one-week high of 0.8498 on Wednesday, after Democratic candidate Kamala Harris put contender Donald Trump on the defensive during yesterday’s televised presidential debate and ahead of US CPI data.

Vice President Harris put former President Trump on the defensive in an intense debate on Tuesday, unleashing a cannonade of attacks on abortion limits, his fitness for office as well as his legal issues.

After the debate, online betting site PredictIt reported that Harris’ chances of achieving victory had improved 3 cents to 56 cents for a $1 payout, while Donald Trump’s chances had decreased 5 cents to 47 cents.

Investor focus now sets on the key US CPI inflation report that may affect the Fed’s interest rate cut trajectory.

Annual headline consumer inflation probably eased to 2.6% in August, according to market consensus, from 2.9% in July.

Annual core CPI inflation probably steadied at 3.2% in August, which has been the lowest rate since April 2021.

Markets are now pricing in about a 37% chance of a 50 basis point Fed rate cut in September and a 63% chance of a 25 basis point rate cut.

As of 9:52 GMT on Wednesday the USD/CHF currency pair was edging down 0.14% to trade at 0.8457.