• USD/CHF gains as the US Dollar strengthens as the Fed signals another potential rate hike before year-end.
• Switzerland’s Q2 2026 current account surplus expanded significantly to reach CHF 23.7 billion.
• The Swiss National Bank is widely expected to hold its benchmark rate steady at 0%.

USD/CHF gains ground after four days of losses, trading around 0.8220 during Asian hours on Wednesday. The currency pair appreciates as the US Dollar (USD) gains ground on the back of a hawkish policy outlook from the Federal Reserve (Fed).

Following a recent 25 basis point increase that brought the benchmark interest rate target to the 3.75%–4.00% range, Fed policymakers have signaled that another rate hike remains on the table before the end of the year. Financial markets are actively pricing in this trajectory, with the CME FedWatch Tool showing nearly an 89.2% probability of a December rate increase as traders turn their focus toward the preliminary US PMI data scheduled for release later on Wednesday.

In Switzerland, macroeconomic data highlighted a significantly widened current account surplus, which rose to CHF 23.7 billion in the second quarter of 2026 compared to a downwardly revised CHF 10.2 billion in Q2 2025. This expansion marks the largest current account surplus for the country since the first quarter of 2025.

Meanwhile, monetary policy expectations for Switzerland remain firmly dovish ahead of the Swiss National Bank’s policy rate announcement on Thursday. Markets widely expect the SNB to hold its key interest rate steady at 0%, a consensus reinforced by a Swiss Bankers Association survey in which 100% of respondents predicted the central bank will keep rates at 0% through the remainder of the year.

USD/CHF momentum fades as UOB shifts to range-trading view

Analysts at UOB Group note that their stance on the Dollar turned constructive only recently, commenting that “we turned positive on USD one week ago.” They point out that the pair “soared to 0.8265,” and that as of last Thursday, with spot around 0.8250, they had cautioned that “while momentum remains strong, it is too early to tell whether it is sufficient for USD to break above 0.8300.” Since then, USD/CHF has eased back from the highs and, although their “strong support” at “0.8185 has not been breached yet,” UOB judges that “upward momentum has largely ended.” In their view, “USD has likely entered a range-trading phase,” with the pair “likely to trade between 0.8155 and 0.8255” over the coming one to three weeks.