• Swiss inflation at the lowest in three years
• Inflationary pressures on SNB recede
• Mounting odds of a fourth Swiss rate cut 

The Swiss franc fell in European trade today on track for the fourth straight loss against the US dollar, plumbing three-week lows after Swiss inflation data.

Swiss consumer prices marked three-year lows in September as inflationary pressures receded on policymakers, in turn boosting the odds of a fourth Swiss rate cut.

The Price

The US dollar rose 0.5% against the Swiss franc to 0.8537, the highest since September 12, with a session-low at 0.8488.

Franc closed Wednesday down 0.4%, marking the third loss in a row following strong US labor data.

Swiss Inflation

Earlier Swiss inflation showed consumer prices rose 0.8% y/y in September, the slowest such rise since July 2021, and down from 1.1% in August.

On a monthly basis, consumer prices actually fell by 0.3%, below estimates of a 0.1% decline. 

It’s now heavily likely the Swiss National Bank will perform the fourth interest rate cut this year at the December meeting.

The SNB

At the September 26 meeting, the SNB cut interest rates for the third meeting in a row by 0.25% to 1%.

The SNB said back then that inflationary pressures have cleared receded compared to the previous quarter, and it might be necessary to issue even more rate cuts to stabilize prices.

• Japan’s PM commits to supporting the economy
• Receding odds of a third Japanese rate hike this year

The yen fell in Asian trade on Thursday against a basket of major rivals, extending losses for the second day against the US dollar and plumbing six-week lows after remarks by the new Japanese PM Shigeru Ishiba on supporting the world’s third largest economy, which in turn reduced the odds of a third Japanese interest rate hike this year.

The yen is also pressured by higher US 10-year treasury yields before important US labor data on Friday.

The Price

The USD/JPY rose 0.55% to 147.24 yen per dollar, with a session-low at 146.28.

The yen lost over 2% on Wednesday against the dollar, marking the second loss in three days, and the largest since June 17, 2022 after bearish remarks from the new Japanese PM.

Ishiba

After a meeting with Bank of Japan Governor Kazuo Ueda, the new PM Shigeru Ishiba said that current economic conditions don’t support another interest rate hike.

Shigeru however did assert that  the BOJ will make its decisions independently on monetary policies.

Japanese Rates

Investors now see little chance of a Japanese interest rate hike in October, and a small chance as well of a hike in December.

US Treasury Yields

US 10-year treasury yields rose 0.4% on Thursday, extending the gains for another session and boosting the greenback against main rivals.

The developments came after strong US private sector employment data in September, which showcases the flexibility of the US labor sector.

According to the Fedwatch tool, the odds of a 0.5% November interest rate cut by the Federal Reserve dipped further to 34%, while the odds of a 0.25% rate cut rose to 66%.

Now investors await the all important US payrolls report tomorrow to gather more clues.

Oil prices gained ground on Wednesday but reduced the gains after US inventory data, which showed an unexpected buildup last week.

The Energy Information Administration reported a buildup of 3.9 million barrels in US crude stocks last week to a total of 416.9 million barrels, while analysts expected a drop of 1.5 million barrels. 

Gasoline stocks rose 1.1 million barrels to 221.2 million barrels, while distillate stocks fell by 1.3 million barrels to 121.6 million barrels. 

Israel said that Iran launched over 180 ballistic missiles at its territory, with Iran’s Revolutionary Forces saying the attack is a response to Israel’s assassination of Ismael Heniyeh and Hassan Nasrallah.

There were no reports of injuries in Israel, and it comes after a similar Iranian attack in April that didn’t leave a lasting damage or impact on the financial markets.

On trading, Brent December futures rose 0.45%, or 34 cents to $73.90 a barrel.

US crude futures due in November rose 0.4%, or 27 cents to $70.10 a barrel.

Most cryptocurrencies fell on Wednesday as the risk appetite kept waning, while investors headed for safe havens amid mounting geopolitical tensions in the Middle East. 

Israel said that Iran launched over 180 ballistic missiles at its territory, with Iran’s Revolutionary Forces saying the attack is a response to Israel’s assassination of Ismael Heniyeh and Hassan Nasrallah.

There were no reports of injuries in Israel, and it comes after a similar Iranian attack in April that didn’t leave a lasting damage or impact on the financial markets.

Otherwise, earlier US data showed the private sector added 143 thousand new jobs in September, above expectations of 128 thousand, and up from 103 thousand in August. 

According to the Fedwatch tool, the odds of a 0.5% Fed interest rate cut in November stood at just 36%, with a 64% chance of a 0.25% rate cut. 

Ethereum 

On trading, ethereum fell 1.5% as of 17:37 GMT to $2440.4.