CHF

• USD/CHF climbs to its highest level since June 2025, extending its advance for a sixth consecutive day.
• The Swiss Franc slips after Bloomberg reports the SNB may maintain zero interest rates through 2027.
• Markets await the Federal Reserve’s interest rate decision on Wednesday.

USD/CHF climbs to fresh highs since June 2025 on Monday after Bloomberg reported that the Swiss National Bank (SNB) could keep its policy rate at zero until the end of 2027. The SNB later declined to comment on the report, according to Reuters. At the time of writing, the pair trades around 0.8187, extending its gains for a sixth consecutive day.

Swiss inflation remains subdued and comfortably within the SNB’s 0%-2% price-stability range. Elevated Oil prices since the US-Iran war began have increased near-term inflation risks, but the impact has been far more contained in Switzerland than in the United States.

The Bloomberg report noted that the outlook is based mainly on current inflation forecasts and assumes no major new shocks, citing people familiar with the thinking inside the central bank.

Diverging monetary policy expectations keep USD/CHF tilted to the upside in the near term. While the SNB is expected to keep rates at zero, traders increasingly expect the Federal Reserve (Fed) to raise interest rates later this year to curb inflation.

The Fed announces its monetary policy decision on Wednesday and is widely expected to leave interest rates unchanged at 3.50%-3.75%. However, traders still price in a 33% chance of an immediate hike, while the probability of a rate increase in September stands near 81%, according to the CME FedWatch Tool.

The wide interest-rate gap between the two countries favours the US Dollar (USD). Meanwhile, the Greenback has also emerged as the preferred safe-haven currency during the US-Iran war, while the SNB’s readiness to curb excessive strength in the Swiss Franc limits demand for the currency.

A temporary pause in attacks between the United States and Iran initially weighed on the US Dollar earlier in the day. However, the optimism faded as the prospects of a peace agreement appear slim.

The US Dollar Index (DXY), which tracks the Greenback’s value against a basket of six major currencies, trades around 101.47, recovering from an intraday low of 101.12.

• USD/CHF falls as easing US-Iran tensions weaken the US Dollar following a weekend pause in hostilities.
• The Fed will likely hold rates steady in July before potential September hikes.
• Falling Swiss 10-year bond yields, now near 0.46%, could weigh on the Swiss Franc.

USD/CHF depreciates after five days of losses, trading around 0.8150 during the Asian hours on Monday. The pair loses ground as the US Dollar (USD) declines on easing geopolitical tensions following a weekend pause in military hostilities between the US and Iran, offering a reprieve after 13 days of escalating conflict.

US halted strikes amid growing concerns over depleting interceptor supplies and a shrinking list of remaining targets within Iran. Additionally, General Dan Caine, Chairman of the Joint Chiefs of Staff, reportedly cautioned President Trump on Friday that continuing the military campaign would severely strain critical munitions reserves.

However, market participants remain cautious about potential supply disruptions after Iran-backed Houthis in Yemen claimed responsibility for attacks on Saudi Arabian facilities along the Red Sea.

Traders expect the Federal Reserve (Fed) to hold interest rates steady on Wednesday before resuming rate hikes in September, though a minority of market participants still anticipate a surprise move at this week’s meeting. Moving forward, investors are closely watching upcoming economic indicators, including advance Q2 GDP data, PCE inflation figures, and earnings reports from major US corporations, for further insight into the underlying strength of the economy.

The USD/CHF pair could rebound as falling Swiss government bond yields may weigh on the Swiss Franc (CHF). With the 10-year Swiss yield dropping near 0.46%, reduced returns on domestic fixed-income assets are prompting global investors to rotate capital toward higher-yielding foreign bonds.

• USD/CHF as safe-haven dollar demand grew amid US-Iran tensions.
• The CME FedWatch Tool shows September Fed rate hike odds rose to 64.2%, up from 57.8% a day earlier.
• Rising geopolitical risks pushed the SNB to reiterate FX interventions to curb a surging franc and safeguard price stability.

USD/CHF extends its gains for the second successive day, trading around 0.8110 during the Asian hours on Tuesday. The pair appreciates as the US Dollar (USD) receives support from rising safe-haven demand amid ongoing hostilities between the United States (US) and Iran, which drove oil prices higher, reviving concerns about inflation and interest rate hikes.

CME FedWatch Tool suggests that markets price in 64.2% odds of a September Fed rate hike, compared to 57.8% a day earlier. In the meantime, Federal Reserve officials have entered their traditional blackout period ahead of next week’s FOMC meeting, where policymakers are widely anticipated to hold the federal funds rate steady.

US attacks on Iran continued for a tenth straight day. The ongoing campaign has coincided with continued retaliatory strikes from Tehran against neighboring countries, further escalating instability across the region.

Although the Swiss National Bank (SNB) maintains a stable medium-term inflation outlook, recent meeting minutes reveal growing caution among policymakers. Escalating geopolitical tensions have increased short-term inflation risks, leading the SNB to reaffirm its readiness to intervene in foreign exchange markets to curb excessive franc appreciation and safeguard price stability. Investors now turn their attention to June’s Trade Balance data, scheduled for release later in the day.

• USD/CHF slips as SNB Minutes showed cautious policymakers, boosting safe-haven Swiss Franc demand.
• The US Dollar falls despite escalating hostilities between Washington and Tehran, as traders focus on softer domestic economic data instead.
• CME FedWatch Tool indicates that markets price in a 61.4% probability of a rate hike in September.

USD/CHF extends its gains for the second successive day, trading around 0.8070 during the Asian hours on Monday. The pair depreciates as the Swiss Franc (CHF) receives support ahead of the release of Trade Balance data for June.

While the Swiss National Bank (SNB) maintains that its medium-term inflation outlook remains largely unchanged, recent Meeting Minutes show that policymakers are growing cautious. Rising geopolitical tensions have heightened near-term inflation risks, prompting the SNB to reiterate its readiness to intervene in the foreign exchange market to prevent the franc from overappreciating and to protect price stability.

The USD/CHF pair depreciates as the US Dollar (USD) declines despite escalating hostilities between the United States (US) and Iran. The US has launched its ninth consecutive night of strikes against Iranian targets. In response, Iranian officials declared that the ceasefire between the two nations has been effectively abandoned, opening the door for deepening disruptions to crucial energy pathways through the region’s narrow waterways.

The Greenback struggles as the Federal Reserve (Fed) is widely expected to hold interest rates steady at its upcoming meeting, though market pricing via the CME FedWatch Tool now reflects a 61.4% probability of a rate hike in September.

Hammack flags broad-based inflation pressures, reinforcing hawkish Fed tone

Fed’s Hammack delivers a more hawkish-than-usual message, with a 7.2/10 FXS Speechtracker score standing above the 6.6/10 historical average and emphasizing that persistently high inflation is the “bigger concern.” The focus on businesses calling for action to curb inflation and consumers “who can’t make ends meet” underscores mounting political and social pressure for tighter policy, even as Hammack acknowledges solid growth and stable consumer spending. References to energy, supply chains, insurance, and AI data center investment as drivers of broad-based price pressures point to a Fed bias toward keeping policy restrictive for longer, which is supportive for the Dollar on balance.

The FXS Fed Sentiment Index has risen by 2.06 points to 128.64, signaling a clear move deeper into hawkish territory well above the neutral 100 line. In combination with the elevated FXS Speechtracker score, this suggests that Fed communication today tilts toward sustained vigilance on inflation, limiting near-term prospects for aggressive rate cuts and underpinning the Dollar against peers.

• USD/CHF remains stronger as the US Dollar recovers, fueled by safe-haven buying and prolonged high Fed rates.
• June CPI and PPI reports fell below market expectations, temporarily easing immediate fears of further rate hikes.
• Swiss Franc safe-haven demand, fueled by oil supply disruptions and rising inflation fears, points to further downside for USD/CHF.

USD/CHF inches lower after opening at a bullish gap, remaining in positive territory and trading around 0.8060 during the Asian hours on Thursday. The pair holds ground as the US Dollar (USD) recovers its daily losses amid rising risk aversion, which could be attributed to United States (US)-Iran tensions boosting oil prices and sparking fresh inflation concerns. This geopolitical friction threatens to prolong the Federal Reserve’s (Fed) higher interest rate environment.

The Guardian reported that the US Central Command (CENTCOM) launched another wave of strikes as part of a concerted effort to keep the critical Strait of Hormuz open. In a direct escalation of hostilities, CENTCOM confirmed that US aircraft fired missiles into an oil tanker’s smokestack within the strategic passage, effectively disabling the vessel and keeping global markets on edge.

Amid this escalating conflict in the Middle East, traders are closely assessing the Federal Reserve’s policy outlook in light of recently softened US inflation data. Tuesday’s US Consumer Price Index (CPI) declined to 3.5% in June from the three-year high of 4.2% set in May, coming in well below the market expectation of 3.8%. This weaker consumer inflation data initially helped reduce immediate concerns that the Fed would soon raise interest rates.

CME FedWatch Tool suggests that markets scaled back expectations for a Fed rate hike in September, with the implied probability falling to around 44% from 50% just a day earlier. However, because the interim US-Iran peace agreement reached last month has effectively unraveled, June’s inflation data does not yet capture the economic impact of this latest military escalation between the US and Iran.

Further supporting this cooling trend, Wednesday’s data showed the US Producer Price Index (PPI) declined to 5.5% on a yearly basis in June, down from 6% in May and below the market expectation of 6.2%. On a monthly basis, the PPI dropped by 0.3%, a notable shift from the 0.6% increase recorded in May and an improvement compared to analysts’ estimates of no change.

The USD/CHF pair faces further downside as rising inflation fears, triggered by oil supply disruptions, fuel safe-haven demand for the Swiss Franc (CHF). Meanwhile, the Swiss National Bank (SNB) maintained its policy rate at 0%. The central bank reconfirmed its readiness to step into the foreign exchange markets to prevent an excessive appreciation of the franc and shield the economy from imported inflation.

• USD/CHF gains as the US Dollar gains on increased safe-haven demand.
• US CENTCOM launched fresh Sunday strikes to weaken Iran’s capability to target civilian vessels in the waterway.
• Swiss weak data permits SNB rate cuts or currency interventions to weaken the Franc.

USD/CHF gains ground for the second successive day, trading around 0.8100 during the Asian hours on Monday. The pair appreciates as the US Dollar rises on increased safe-haven demand amid heightened geopolitical tensions in the Middle East. According to Bloomberg, the US Central Command (CENTCOM) launched additional strikes on Sunday evening, aimed at weakening Iran’s capability to target civilian vessels navigating the waterway.

Reuters reported that US forces have hit more than 300 Iranian targets over a three-night span, including 140 on Saturday alone, while Washington and Tehran issued conflicting declarations regarding whether the strait remains open to maritime traffic.

Additionally, the US Dollar receives support from escalating US-Iran missile strikes, which pushed oil higher and sparked fears of inflation and higher Federal Reserve (Fed) interest rates. The US Consumer Price Index (CPI) inflation data will be eyed on Tuesday for further clues on the Federal Reserve’s (Fed) policy outlook. The headline CPI is expected to decline by 0.1% MoM in June, while the core CPI is projected to show a rise of 0.3% during the same period.

Traders expect the Fed to deliver one more interest-rate increase before the year concludes. Meanwhile, all eyes will be on Fed Chair Kevin Warsh as he makes his first official appearance before the US Congress this Tuesday.

Switzerland’s consumer confidence index dropped to -36 in June 2026, down from -32 in June 2025 and slightly worse than the market forecast of -35. With domestic sentiment deeply negative and Swiss inflation remaining highly contained, flatlining month-on-month at just 0.5% annually in June, the Swiss National Bank (SNB) faces zero pressure to raise interest rates. If anything, weak data keeps the door wide open for the SNB to cut interest rates or intervene in the foreign exchange market to intentionally weaken the franc. This makes the CHF less attractive to yield-seeking investors.

• USD/CHF rises as the US Dollar gains following US airstrikes on Iran over Strait of Hormuz ship attacks.
• Iran’s joint military command denounced the attacks on southern Iran as blatant aggression, promising a crushing military response.
• Switzerland’s 10-year yield edges above 0.34%, tracking higher global borrowing costs as surging oil prices reignite inflation fears.

USD/CHF extends its gains for the third successive day, trading around 0.8090 during the Asian hours on Wednesday. The pair appreciates as the Greenback receives support from safe-haven demand amid renewing geopolitical tensions. US airstrikes against Iran came in response to Iranian attacks on commercial vessels in the crucial Strait of Hormuz, including a Qatari LNG carrier and a Saudi oil tanker.

Reacting to recent US airstrikes, Iranian Parliament Speaker Mohammad Bagher Ghalibaf warned that the era of bullying and extortion has ended and insisted that Iran will not fold under pressure. Meanwhile, the country’s top joint military command denounced the attacks on southern Iran as blatant aggression, promising a crushing military response. Defiant over the strategic waterway, Tehran reaffirmed that it will block any US interference regarding the control and management of the Strait of Hormuz.

However, the upside of the US Dollar could be restrained due to cooling rate-hike expectations, a shift triggered by last week’s weaker-than-expected Nonfarm Payrolls (NFP) data. According to LSEG data, market pricing for total Fed rate increases by December has dropped to roughly 26 basis points, down significantly from the 38 basis points projected just a week ago.

Switzerland’s 10-year government bond yield edged above 0.34%, tracking a global rise in borrowing costs as surging oil prices reignited broader inflation concerns. This uptick comes despite domestic Swiss inflation slowing to 0.5% in June, marking its first decline in eight months and remaining well within the Swiss National Bank’s (SNB) 0–2% target range. The economic backdrop was further supported by the labor market, as Switzerland’s non-seasonally adjusted unemployment rate fell to 2.9% in June 2026, dropping below the 3.0% seen in the previous two months and beating market forecasts of 3.1%.

Meanwhile, the International Monetary Fund (IMF) recently urged the SNB to maintain flexibility, advising the central bank to stand ready to either tighten policy or slash interest rates into negative territory should stagflation risks materialize. In response, the Swiss central bank reaffirmed its ongoing commitment to currency market interventions to maintain economic stability.