USD/CHF holds positive ground above 0.9100 ahead of Fed Chair Powell’s testimony

• USD/CHF drifts higher to 0.9115 in Tuesday’s early European session. 
• The threats of reciprocal tariffs and additional protectionist measures by Trump boost the US Dollar. 
• The ongoing Middle East geopolitical tensions could boost the safe-haven currency like the CHF. 

The USD/CHF pair trades in positive territory for the fourth consecutive day around 0.9115 on Tuesday during the early European trading hours. The threats of reciprocal tariffs and the imposition of 25% tariffs on aluminium and steel by US President Donald Trump provide some support to the US Dollar (USD). Investors will closely monitor Federal Reserve (Fed) Chair Jerome Powell’s semi-annual testimony on Tuesday. 

Analysts believe that tariff policies by the Trump administration could be inflationary and put further pressure on the Fed to keep interest rates elevated. Markets are pricing in 36 basis points (bps) of cuts this year, down from 42 bps after an upbeat labour market report on Friday. This, in turn, underpins the Greenback against the Swiss Franc (CHF).