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Swiss Franc (CHF) Update – June 20, 2025 ๐Ÿ‡จ๐Ÿ‡ญ

Sarah Johnson

1. SNB Cuts Rates to Zero Amid Deflation Pressures

  • On June 19, the Swiss National Bank (SNB) surprised markets by cutting its policy rate by 25 basis points to 0%, marking its sixth straight cut since March 2024.

  • The decision came as inflation dropped to –0.1% in May, prompting the SNB to guard against prolonged deflation and support economic growth.

2. Franc Strength Sparks Concerns

  • Despite the rate cut, the franc remains strong up around 11% year-to-date against the U.S. dollar as investors seek safe-haven assets amid global uncertainty .

  • The SNB acknowledged the franc's resilience and reiterated readiness to intervene in foreign exchange markets if needed.

3. Market Reaction & Global Context

  • The franc briefly rallied, with USD/CHF trading near 0.8186–0.819 in light, holiday-thinned trade.

  • The move comes alongside other surprise rate cuts from Europe, including Norway, reflecting growing unpredictability in global monetary policy.

๐Ÿ“‰ Technical & Short-Term Outlook (USD/CHF)

  • Current rate: USD/CHF hovers around 0.8167 slightly weaker dollar trend.

  • Support zone: 0.8160–0.8165, as technical indicators project a possible test here .

  • Resistance zone: 0.8205–0.8220, with upside capped by the 21-day EMA (~0.8205).

๐Ÿ” What to Watch Next

  1. SNB warnings Any push toward negative rates or more FX interventions will significantly impact CHF valuation.

  2. Inflation trends With deflationary pressures persisting, the SNB may remain dovish, limiting franc upside.

  3. Global risk backdrop Middle East tensions, U.S. trade policy, and volatility in oil prices are influencing safe-haven flows.

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