SNB Rate Freeze Fuels USD/CHF Rally Amid Diverging Monetary Policy Expectations
The Swiss Franc slipped against the US Dollar on Monday as diverging monetary policy expectations weighed on its value. The Bloomberg report suggested that the Swiss National Bank (SNB) could keep its policy rate at zero until the end of 2027, prompting traders to bet on a stronger US Dollar.
The SNB later declined to comment on the report, according to Reuters. Despite this, the USD/CHF pair climbed to fresh highs since June 2025, trading around 0.8187 and extending its gains for a sixth consecutive day.
The wide interest-rate gap between the two countries favors the US Dollar, which has also emerged as the preferred safe-haven currency during the US-Iran war. The SNB's readiness to curb excessive strength in the Swiss Franc limits demand for the currency.