The USD/CHF pair traded in the positive territory near 0.8825 during the early European session on Friday (3/28). The greenback moved higher as traders assessed how severe the tariffs scheduled to be announced by US President Donald Trump next week are likely to impact the global economy. The US Personal Consumption Expenditures (PCE) data for February will be in focus on Friday.

Growing optimism that Trump will be flexible on tariffs could boost risk sentiment and the US Dollar (USD). Trump said on Monday that auto tariffs would be implemented soon, but not all threatened duties will be imposed on April 2 and some countries may get exemptions. However, signs of escalating trade tensions could support the Swiss Franc (CHF), a safe-haven currency, and act as a headwind for the pair.

The third release of figures from the Bureau of Economic Analysis on Thursday showed that the US economy grew at an annualized pace of 2.4% in the final three months of 2024. This reading was slightly better than the previous fourth-quarter growth estimate.

Traders will take more cues from the US PCE inflation data due on Friday. Cooler inflation will allow the Federal Reserve (Fed) to cut interest rates. The US central bank cut interest rates late last year but kept its benchmark rate steady at its March meeting on concerns that Trump's policy of raising tariffs could reignite high inflation. (Newsmaker23)

Source: FXstreet