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During Tuesday's Asian session, the USD/CHF pair oscillates in a narrow range below the 0.9100 level and consolidates its significant gains from the previous two days.

Increasing odds that the Federal Reserve (Fed) will forego a rate hike this month continue to exert downward pressure on the US Dollar (USD) and act as a headwind for the USD/CHF pair. A number of influential Federal Reserve (Fed) officials recently reaffirmed market expectations of an imminent pause in the US central bank's year-long cycle of policy tightening.

However, Fed fund futures indicate the possibility of an additional 25 basis point rate hike at the July FOMC meeting. Last week's unexpected rate hikes by other major central banks - the Reserve Bank of Australia (RBA) and the Bank of Canada (BoC) - indicated that the fight against inflation is not yet over, which boosted wagers. In turn, this limits USD losses and provides support for the USD/CHF pair.

Traders appear reluctant to place aggressive bets and prefer to sit on the periphery prior to the release of the most recent US consumer inflation data, which is scheduled for release later during the early North American session. The crucial US CPI report will impact the Fed's policy outlook and drive USD demand, providing significant impetus to the USD/CHF pair prior to Wednesday's FOMC policy decision.

In the interim, a generally upbeat mood on the equity markets could weaken the safe-haven Swiss Franc (CHF) and boost the USD/CHF exchange rate. Nonetheless, a modest decline in US Treasury bond yields may discourage traders from positioning for a significant USD recovery, suggesting that the major currency is more likely to extend its subdued/range-bound price action on Tuesday.

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