USD/CHF holds gains near 0.7700 amid Middle East tensions

• USD/CHF edges higher to near 0.7695 in Monday’s early Asian session. 
• Escalating tensions in the Middle East could boost the safe-haven flows. 
• The US PPI rose 0.5% MoM in January, stronger than expected. 

The USD/CHF pair holds positive ground around 0.7695 during the early Asian session on Monday. Traders continue to assess the impact of the escalating Mideast war after the US and Israel strike on Iran over the weekend. The Institute for Supply Management (ISM) will release its Manufacturing Purchasing Managers Index (PMI) report for February later on Monday. 

The US and Israel began "major combat operations" in Iran over the weekend. Iran has responded by firing drones and missiles into Israel and American targets, including the United Arab Emirates, Bahrain, Qatar, Kuwait, and Jordan. 

In Iran, Supreme Leader Ayatollah Ali Khamenei was killed after the US and Israel launched a "massive" and ongoing attack against Iran's leadership and military, per CNBC. The group will continue to run the country until a new leader is named

Traders will closely monitor the developments surrounding the US-Iran conflict. Any signs of escalating tensions in the Middle East could boost the safe-haven currency, such as the Swiss Franc (CHF), in the near term. 

On the other hand, a hotter-than-expected US Producer Price Index (PPI) report could lift the Greenback against the CHF. The headline US PPI rose 0.5% month-over-month in January, surpassing the 0.3% forecast. Market participants now largely expect the US Federal Reserve (Fed) to hold rates steady at the March meeting.