Fed Hike Sends CHF Tumbling Amid Interest Rate Speculation

The US Federal Reserve (Fed) raised its federal funds rate by 25 basis points to a target range of 3.75% to 4.00%, matching market expectations.

In his post-meeting remarks, Fed Chair Kevin Warsh explained that the rate hike was driven by inflation remaining 'too high' and lingering 'for too long.'

Rabobank's FX strategists note that, unlike other G10 central banks, there is little risk of a Swiss National Bank (SNB) rate hike this year.

The SNB policy rate remains at zero, raising the prospect of the CHF adopting funding currency status as investors look for low-yielding currencies to finance carry trades.