Swiss Franc Firms as Markets Await Key SNB Rate Call

Key Moments

SNB Decision in Focus as Franc Strengthens

USD/CHF is under pressure during Asian trading on Thursday, hovering near 0.8240 after a modest advance in the previous session. The move reflects renewed demand for the Swiss Franc as investors position ahead of the Swiss National Bank’s interest rate announcement due later in the day.

Economists at DBS Group Research project that the SNB will maintain its policy rate at 0% at the September 24 meeting. However, they anticipate changes to the central bank’s forecasts. DBS highlights that the SNB is “nevertheless likely to raise its near-term inflation forecast as elevated energy prices feed through into the economy amid persistent uncertainty in the Middle East,” noting that stronger Swiss growth and some easing in CHF haven pressures against the Euro and Pound have reduced the need for immediate policy action.

Dollar Eases Despite Firm Fed Expectations

The pullback in USD/CHF coincides with a retreat in the US Dollar, which gives back its daily advance and interrupts a three-day winning streak. This comes even as markets maintain a hawkish view on the Federal Reserve’s policy outlook.

That stance was reinforced by the latest Flash US S&P Global PMI data for September, which showed the manufacturing sector expanding more than anticipated at 52.0. The stronger manufacturing reading helped counter modest weakness in services and composite indicators.

Following these US data releases, market expectations for a 25-basis-point Fed rate increase in October climbed to nearly 69.7%, up from 48.7% the prior week. Traders are now watching the upcoming US weekly Initial Jobless Claims figures, while several Fed officials have recently signaled backing for the latest rate hike and cautioned that inflation risks remain elevated.

USD/CHF Technical Picture

On the daily chart, USD/CHF is quoted at 0.8240, retaining a short-term bullish tone as the pair holds above both its short-term and medium-term exponential moving averages. The 9-period and 50-period Exponential Moving Averages lie beneath spot, supporting an underlying uptrend.

The 14-day Relative Strength Index, hovering near 63, indicates solid positive momentum that has not yet reached overbought conditions. The FXS Fed Sentiment Index around 148 adds to a constructive macro environment for the US Dollar, consistent with the favorable technical setup.

On the downside, first support is located at the 9-period EMA at 0.8213. If corrective selling deepens, additional support emerges at the 50-period EMA near 0.8121. With no nearby resistance levels identified in the current dataset, the pair appears inclined to explore higher levels as long as it stays above 0.8213. However, the elevated RSI suggests that the pace of gains could moderate if momentum moves closer to overbought territory.

Swiss Franc Performance Against Major Currencies

The Swiss Franc’s performance today shows notable strength across major peers, with the currency standing out particularly against the Australian Dollar.

The table below summarizes the percentage change of the Swiss Franc (CHF) against selected major currencies today, based on the information provided.

The accompanying heat map referenced in the original data illustrates percentage moves between major currencies. In that framework, the currency listed in the left-hand column is treated as the base, while the currency along the top row is the quote. For example, selecting the Swiss Franc as the base on the left and moving horizontally to the US Dollar column shows the percentage change for CHF (base)/USD (quote).