Swiss Data Supports Buying Franc Crosses on Dips

Written by Sandra Leggero

Sandra Leggero has a background in financial markets, having spent more than 9 years in commodities trading for several European and Asian companies. She holds a degree in Economics from the University of Pavia and specializes in emerging markets.

, | Updated: September 3, 2026

Key Moments

August Swiss CPI and second-quarter GDP both came in stronger than expected, prompting profit-taking in EUR/CHF and USD/CHF.
Despite the upside surprises, Societe Generale strategists see no change in the outlook for Swiss National Bank policy, with inflation averaging 0.6% so far in 3Q.
Softer FX volatility and wider G10/SNB rate differentials are seen as supportive for buying EUR/CHF and broader G10/CHF on pullbacks, although French fiscal and political risks remain a potential tail risk.

Swiss Data Beat Expectations, But SNB View Steady

Strategists at Societe Generale highlight that the latest Swiss macroeconomic releases, namely the August Consumer Price Index (CPI) and second-quarter Gross Domestic Product (GDP), exceeded expectations. This stronger-than-anticipated data performance led to profit-taking in both EUR/CHF and USD/CHF.

According to the strategists, the inflation backdrop remains consistent with the Swiss National Bank’s prior projections. They note that inflation is averaging 0.6% so far in the third quarter, which they say is aligned with the forecast published in June.

The strategists point out that, in their view, “The data should not shift the outlook for SNB policy. Inflation is averaging 0.6% so far in 3Q which is in line with the June forecast.”

Inflation Path and Rate Differentials Support Dip-Buying

Societe Generale references the SNB’s inflation projection, stating that “The projection is for inflation to ‘initially continue to increase slightly in the coming quarters, before declining again somewhat in the first half of 2027.'” Within this framework, they argue that investors may find value in buying Swiss Franc crosses on weakness.

The strategists suggest that market participants could be drawn to “buyers on dips in EUR/CHF and G10/CHF more generally,” emphasizing that such positioning might be supported by the combination of wider interest rate differentials between G10 central banks and the SNB, along with subdued foreign exchange volatility.

French Risk as a Potential Tailwind for the Franc

While articulating a constructive stance on dip-buying strategies in EUR/CHF, the strategists also caution that specific risks tied to France could reassert the Franc’s safe-haven appeal.

They flag a particular relationship between the currency pair and bond markets, noting that “The caveat and tail risk for EUR/CHF is a revival of the inverse correlation with the 10y OAT/Bund spread which has completely broken down since June.”

Against this backdrop, they raise the question: “Will tensions around the French budget and presidential elections cede advantage to the Franc?” This underscores their view that renewed concerns over French fiscal policy and political developments could again bolster CHF strength against the euro.

Market Implications Summary

Factor	Current Assessment	Implication for CHF
Swiss August CPI and 2Q GDP	Both surprised to the upside	Triggered profit-taking in EUR/CHF and USD/CHF
SNB policy outlook	Unchanged; inflation averaging 0.6% in 3Q, in line with June forecast	Supports case for using dips to enter EUR/CHF and G10/CHF positions
G10/SNB rate differentials and FX volatility	Wider differentials and low volatility	Seen as encouraging dip-buying in CHF crosses
French fiscal and political risks	Potential revival of focus on budget and presidential elections	Could restore CHF strength as a tail risk for EUR/CHF
10y OAT/Bund spread correlation	Inverse correlation with EUR/CHF has “completely broken down since June”	Re-emergence of this link could favor the Franc

Editorial and Risk Disclosures

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.