- USD/CHF attracts buyers for the fifth straight day amid a broadly firmer USD.
- The Fed’s hawkish pause on Wednesday lifted the USD to over a one-week top.
- Bets for more aggressive rate cuts by the SNB continue to weigh on the CHF.
The USD/CHF pair builds on its recent recovery from the vicinity of mid-0.8000s, or a nearly two-month low touched last week, and scales higher for the fifth straight day on Thursday. The momentum lifts spot prices to over a one-week high during the Asian session, with bulls awaiting a sustained move beyond the 0.8200 mark ahead of the key central bank event risk.
The Swiss National Bank (SNB) will announce its policy decision later today and is widely expected to lower interest rates by 25 basis points (bps) to zero. Moreover, investors seem convinced that the central bank would not shy away from bringing negative interest rates this year amid heightened uncertainty around the erratic US tariff policy. This is seen as a key factor behind the Swiss Franc’s (CHF) relative underperformance and acts as a tailwind for the USD/CHF pair amid some follow-through US Dollar (USD) buying.
In fact, the USD Index (DXY), which tracks the Greenback against a basket of currencies, advances to its highest level in over a week in the wake of the Federal Reserve’s (Fed) hawkish pause on Wednesday. In the so-called dot plot, the committee projected two rate cuts by the end of 2025, though policymakers see only one 25-basis points rate cut in each of 2026 and 2027. This, in turn, offers additional support to the USD/CHF pair. However, rising geopolitical tensions could limit deeper losses for the safe-haven CHF.
As the Israel-Iran conflict enters its seventh day, reports suggest that US officials are preparing for a possible Iran strike this coming weekend. The Israel Defense Forces (IDF) warned residents of the cities of Arak and Khondab in central Iran to evacuate for their safety as it is operating in the area against Iranian military infrastructure. This raises the risk of an all-out war in the Middle East, which, along with persistent trade-related uncertainties, continues to weigh on investors’ sentiment and triggers the global flight to safety.
Economic Indicator
SNB Interest Rate Decision
The Swiss National Bank (SNB) announces its interest rate decision after each of the Bank’s four scheduled annual meetings, one per quarter. Generally, if the SNB is hawkish about the inflation outlook of the economy and raises interest rates, it is bullish for the Swiss Franc (CHF). Likewise, if the SNB has a dovish view on the economy and keeps interest rates unchanged, or cuts them, it is usually bearish for CHF.
Next release: Thu Jun 19, 2025 07:30
Frequency: Irregular
Consensus: 0%
Previous: 0.25%
Source: Swiss National Bank
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
