Forex
Home›Forex›Major Pairs›Swiss franc slips toward 0.94 EUR/CHF as SNB stays dov…
Swiss franc slips toward 0.94 EUR/CHF as SNB stays dovish
OCBC expects the SNB to keep policy rates at zero for the rest of the year, supporting a view of continued CHF weakness.
OCBC’s Sim Moh Siong and Christopher Wong said the Swiss franc has weakened toward their year-end EUR/CHF target of 0.94, a move they view as reinforcing the CHF’s role as a preferred funding currency for carry trades. They pointed to subdued domestic inflation and limited near-term imported inflation pressures as key reasons the Swiss National Bank is likely to remain dovish. The analysts expect any pickup in imported inflation from the currency’s depreciation to take at least another two quarters to show through, given domestic inflation is still below the midpoint of the SNB’s 0 to 2 percent price stability range.
OCBC also linked the franc outlook to policy expectations and potential intervention risks involving the yen. With the CHF described as soft amid mixed growth signals, they expect the SNB to keep policy rates at zero through the rest of the year, which they said would help sustain CHF softness.
The note also cited mixed economic indications, including strength in the pharmaceutical sector alongside softer industrial activity and weaker consumer-facing earnings. In their view, these factors provide little justification for a more hawkish SNB stance, even as they said the CHF has been the worst-performing G10 currency against the US dollar so far in 3Q26.