The Swiss Franc (CHF) is well-known for its safe-haven status. It is currently a focal point in the forex market. This attention arises as the Swiss National Bank (SNB) considers the possibility of returning to negative interest rates. To date, the CHF has shown strength against other major currencies. With current economic developments, traders will analyze for cues on whether this trend will continue or reverse. In this article, we will examine the economic and technical developments in Switzerland. We will also analyze price movements compared to other global currencies.
In April 2025, a significant event took place. Inflation rates dropped to an unprecedented 0 percent. This marked the lowest level seen in four years. The notable drop in inflation has led the Swiss National Bank (SNB) to consider lowering interest rates below zero. This strategic move aims to preserve price stability in the Swiss economy. This stability is crucial for maintaining consumer confidence and supporting economic growth.
If the central bank decides to implement this rate cut, the effects could be significant, especially for the value of the Swiss Franc (CHF). A decrease in interest rates usually causes the currency to lose value. This change then affects its exchange rates with major global currencies. Notably, this would have implications for the USD/CHF, EUR/CHF, AUD/CHF, and CHF/JPY currency pairs. To grasp the potential consequences of this decision, we need to examine exchange rate dynamics. These dynamics are complex and have broader economic effects
USD/CHF Weekly Chart
The Federal Reserve has kept its interest rates between 4.25 percent and 4.50 percent. This decision contrasts with the possible rate cuts being considered by the Swiss National Bank (SNB). Analyzing the recent price movements, it is clear that the USD/CHF currency pair has dropped below a key support level. This level was set by the weekly trend line. This development suggests that any pullbacks toward the 0.84 level should be interpreted as favorable selling opportunities for traders. If the downward trend continues, market participants will closely watch the historical all-time lows at 0.7069. This level serves as an important psychological and technical benchmark in the current market dynamics.
EUR/CHF Weekly Chart
The European Central bank (ECB) is expected to continue its easing cycle, with another rate cut in June. Combined with the SNB’s potential cuts, sideways price action combined within range showed on weekly chart should not be ruled out.
AUD/CHF Weekly Chart
As of late, Australia has kept interest rates unchanged, but the central bank is forecasted to cut rates soon. Similar to the EUR/CHF pair, we do not dismiss the chance that the price movement will remain within its established channel. This situation may persist until significant developments take place.
CHF/JPY Daily Chart
Both the Swiss franc and Japanese yen are seen as safe-haven currencies. While the Swiss National Bank may cut interest rates, the Bank of Japan is taking a passive approach. These factors could cause volatility in this currency pair.
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Ronald Francois
Ronald is a senior market strategist at Sigmanomics.com, bringing over a decade of hands-on experience in equity markets and three years of specialized expertise in options trading. Known for his sharp fundamental analysis and deep understanding of macroeconomic trends, Ronald provides readers with actionable insights that bridge the gap between institutional strategy and individual investor needs.
