Home›Forex›Major Pairs›Swiss franc weakens as traders lean toward a longer Fe…

Swiss franc weakens as traders lean toward a longer Fed rate gap

USD/CHF rose to about 0.8187, extending a six-day streak, after Bloomberg said the SNB could keep its policy rate at zero until end-2027.

Reported · Written up by our desk · Major Pairs

USD/CHF climbed to fresh highs since June 2025, trading around 0.8187 and extending gains for a sixth straight day, as expectations diverged between the Swiss National Bank and the Federal Reserve, FXStreet reported citing Reuters and Bloomberg.

Bloomberg said the SNB could keep its policy rate at zero until the end of 2027, and the SNB declined to comment on the report. With Swiss inflation described as subdued and within the SNB’s 0% to 2% price-stability range, near term inflation risks tied to elevated oil prices were seen as more contained in Switzerland than in the United States.

In FXStreet’s account, traders increasingly expect the Fed to raise rates later this year to curb inflation, ahead of the Fed’s Wednesday policy decision. While the market broadly expects rates to stay at 3.50% to 3.75%, CME FedWatch Tool data cited by FXStreet showed a 33% chance of an immediate hike and about an 81% chance of a September increase.

FXStreet also pointed to the interest rate gap favoring the US dollar, which has been viewed as the preferred safe-haven currency during the US-Iran war. The outlet said the Greenback briefly weakened on a temporary pause in attacks, but optimism faded as a peace agreement appeared unlikely, with the US Dollar Index around 101.47 after recovering from an intraday low near 101.12.

Latest closeDollar index 101.47 ▲0.0%

More like this

Sources