The USD/CHF pair held on to its intraday gains through the first half of the European session, albeit has retreated few pips from daily tops and was last seen hovering around the 0.9180 region. Following the previous day's sharp pullback from the 0.9220 region, or one-and-half-week tops, the USD/CHF pair managed to regain some positive traction on Tuesday. A modest recovery in the global equity markets undermined the safe-haven Swiss franc and was seen as a key factor that extended some support to the USD/CHF pair. The intraday uptick, however, lacked any strong follow-through and faltered just ahead of the 0.9200 round-figure mark. A fresh leg down in the US Treasury bond yields capped the US Dollar Index near the 93.00 mark, or the highest level since April 5. This, in turn, held traders from placing aggressive bullish bets around the USD/CHF pair.
Against the backdrop of fresh COVID-19 jitters, diminishing odds for an imminent Fed action dragged the yield on the benchmark 10-year US government bond to a more than five-month lows of 1.175%. In fact, the Fed funds futures showed the chances of a 25 bps rate hike by the US central bank in December 2022 fell to 58% from 90% on July 13. Moreover, the spread between 10-year and 2-year yields remained near February lows, signalling doubts about the growth outlook. This comes amid growing market fears that the spread of the Delta variant of the coronavirus would derail the global economic recovery. This acted as a tailwind for the CHF and kept a lid on any further gains for the USD/CHF pair. 
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Free TrialUSD/CHF seemed struggling to capitalize on its modest intraday gains on Tuesday
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The USD/CHF pair held on to its intraday gains through the first half of the European session, albeit has retreated few pips from daily tops and was last seen hovering around the 0.9180 region. Following the previous day's sharp pullback from the 0.9220 region, or one-and-half-week tops, the USD/CHF pair managed to regain some positive traction on Tuesday. A modest recovery in the global equity markets undermined the safe-haven Swiss franc and was seen as a key factor that extended some support to the USD/CHF pair. The intraday uptick, however, lacked any strong follow-through and faltered just ahead of the 0.9200 round-figure mark. A fresh leg down in the US Treasury bond yields capped the US Dollar Index near the 93.00 mark, or the highest level since April 5. This, in turn, held traders from placing aggressive bullish bets around the USD/CHF pair.
Against the backdrop of fresh COVID-19 jitters, diminishing odds for an imminent Fed action dragged the yield on the benchmark 10-year US government bond to a more than five-month lows of 1.175%. In fact, the Fed funds futures showed the chances of a 25 bps rate hike by the US central bank in December 2022 fell to 58% from 90% on July 13. Moreover, the spread between 10-year and 2-year yields remained near February lows, signalling doubts about the growth outlook. This comes amid growing market fears that the spread of the Delta variant of the coronavirus would derail the global economic recovery. This acted as a tailwind for the CHF and kept a lid on any further gains for the USD/CHF pair.