The CAD/CHF currency pair hovered above a fresh 2-week low of 0.5637 on Tuesday ahead of Bank of Canada’s minutes release.
Meanwhile, the Swiss Franc has outperformed even against a generally risk-positive market backdrop.
The Bank of Canada kept its benchmark interest rate intact at 2.25% at its January meeting, in line with market expectations.
BoC policy makers said that the current stance remained appropriate given the central bank’s baseline economic outlook.
Governor Tiff Macklem noted that a high level of trade uncertainty made it difficult to project when and in what direction the policy rate might next move.
In its quarterly monetary policy report, the central bank maintained its forecast for modest growth this year and in 2027, while inflation is expected to hover around the 2% target.
At the same time, Societe Generale analysts cited specific market flows as the primary catalyst behind the latest leg of Swiss Franc strength. They pointed to Alphabet’s issuance of a five-part bond in Swiss Francs as a key factor supporting the currency.
On the monetary policy front, Societe Generale highlighted the recent communication from the Swiss National Bank. The analysts referenced comments by the SNB President on the conditions under which the central bank might reintroduce negative interest rates.
While emphasizing that the SNB is prepared to act if needed, the analysts underscored that the hurdle for such a move was still significant as long as the inflation outlook was assessed to be in line with the target for the coming two years.
The CAD/CHF currency pair was last little changed on the day to trade at 0.5649.
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