Swiss franc steadies near one-year low as Middle East uncertainty persists
The Swiss franc held near $0.81 after weakening to a nearly one-year low, with attention focused on growth, inflation, and SNB policy amid Middle East-related uncertainty.
The Swiss franc hovered near $0.81 after weakening to a nearly one-year low, as uncertainty over the Middle East conflict keeps attention on economic growth, inflation and monetary policy.
Swiss economic growth, excluding sports, accelerated sharply to 1.5% in Q2 2026.
Meanwhile, inflation slowed to 0.4% in July, its lowest level in four months.
Both readings point to limited pass-through from higher energy prices linked to geopolitical tensions, contrasting with the SNB’s expectations of moderating growth and rising inflation.
Foreign exchange interventions supported exporters by limiting safe-haven flows into the franc and preventing excessive appreciation.
However, US trade policy remains a key uncertainty.
The SNB kept rates at 0% at its latest meeting and is expected to hold them there through 2027, with further cuts viewed as a contingency rather than the base case.
Most economists expect the first rate hike in early 2028, while markets are pricing in one as early as March 2027.