Swiss Franc Hits Four-Month Low Amid Hawkish Fed Outlook

The Swiss Franc has weakened to its lowest level in over four months, falling below $0.81 as investors flock to the US dollar.

This decline is largely due to a more hawkish outlook from the Federal Reserve, which has boosted expectations of a September rate hike and supported demand for dollar-denominated assets.

Fed Chairman Warsh noted that if inflation isn't returning to target, they 'would have work to do,' implying potential action in the near future.

The Swiss National Bank (SNB) maintains its policy rate at 0% and is expected to keep it unchanged throughout 2027. However, markets are pricing in a potential rate hike as early as March 2027, making the currency more attractive for carry trades.