Swiss Franc Weakens Near 0.8250 as Markets Await SNB

Key Moments

Dollar Strength Pushes USD/CHF Higher

USD/CHF is recovering after four consecutive sessions of losses, trading near 0.8220 during Asian hours on Wednesday. The pair is gaining support from renewed US Dollar strength, driven by a more hawkish policy tone from the Federal Reserve.

The Fed recently raised its benchmark interest rate by 25 basis points, bringing the target range to 3.75%-4.00%. Policymakers have indicated that another rate increase remains possible before the end of the year. According to pricing reflected in the CME FedWatch Tool, market participants see nearly an 89.2% probability of a rate hike in December as attention turns to preliminary US PMI figures scheduled for release later on Wednesday.

Swiss Current Account Surplus Jumps

On the Swiss side, recent macroeconomic data highlighted a substantial improvement in the external balance. Switzerland’s current account surplus increased to CHF 23.7 billion in the second quarter of 2026, up from a downwardly revised CHF 10.2 billion in Q2 2025. This marks the largest surplus since the first quarter of 2025.

Despite this strong external position, expectations for domestic monetary policy remain subdued. Investors are focused on the upcoming Swiss National Bank decision on Thursday, with consensus centering on an unchanged policy stance.

SNB Seen on Hold at 0%

Market participants broadly anticipate that the Swiss National Bank will leave its benchmark rate unchanged at 0%. This outlook is supported by a Swiss Bankers Association survey indicating that 100% of respondents expect the central bank to keep rates at 0% for the rest of the year.

The contrast between a potentially more restrictive Federal Reserve and a steady, dovish-leaning SNB is contributing to the recent softness in the Swiss Franc against the US Dollar.

UOB Sees USD/CHF Shifting Into a Range

Analysts at UOB Group report that they only recently turned constructive on the US Dollar, stating that “we turned positive on USD one week ago.” They note that USD/CHF “soared to 0.8265,” and that as of last Thursday, when spot was around 0.8250, they had warned that “while momentum remains strong, it is too early to tell whether it is sufficient for USD to break above 0.8300.”

Since that point, USD/CHF has retreated from its peak. UOB highlights that their “strong support” at “0.8185 has not been breached yet,” but assesses that “upward momentum has largely ended.” Their current view is that “USD has likely entered a range-trading phase,” with the pair “likely to trade between 0.8155 and 0.8255” over the next one to three weeks.