{"id":1444406,"date":"2026-03-18T07:28:06","date_gmt":"2026-03-18T06:28:06","guid":{"rendered":"https:\/\/www.payoff.ch\/news\/snb-under-the-spell-of-the-franc"},"modified":"2026-03-23T09:28:15","modified_gmt":"2026-03-23T08:28:15","slug":"snb-under-the-spell-of-the-franc","status":"publish","type":"post","link":"https:\/\/www.payoff.ch\/en\/news\/snb-under-the-spell-of-the-franc","title":{"rendered":"SNB under the spell of the franc"},"content":{"rendered":"\n

The tension increases with every basis point. When the Monetary Policy Council of the Swiss National Bank (SNB) meets on Thursday for its next monetary policy assessment, the markets will be looking less at what is decided and more at what is unspoken. Because in the background is a currency pair that has known a clear direction for months: EUR\/CHF<\/a><\/strong>. The Swiss franc has appreciated significantly, the parity has not only fallen – it is history.<\/p>\n\n\n\n

What was once considered a psychologically hard-fought mark has long since been broken. Neither the euro nor the US dollar<\/a><\/strong> have been able to stay above the one-to-one threshold in the long term. Analysts are now talking about a “structural regime change” in favor of the franc. The SNB is therefore faced with a tricky question: put the brakes on – or let it run?<\/p>\n\n\n\n

Focus on interest rate policy<\/h3>\n\n\n\n

At first glance, the SNB’s room for maneuver appears limited. Unlike in the eurozone, inflation in Switzerland has remained comparatively moderate. Year-on-year, consumer prices rose by 0.1% in February, as they did in January. This removes a key reason for aggressive interest rate hikes. But this is precisely where the dilemma lies: a strong franc has a deflationary effect. Import prices fall, purchasing power increases, but at the same time exports and tourism come under pressure. <\/p>\n\n\n\n

An interest rate cut could theoretically weaken the franc. However, this step harbors risks: Detached from the key rate, capital could continue to flow into the safe haven of Switzerland on a large scale as global uncertainties increase. At the same time, an overly expansionary policy would jeopardize the inflation target. This leaves the option of verbal intervention or even direct intervention in the foreign exchange market. The SNB has repeatedly shown in the past that it is prepared to sell Swiss francs and buy foreign currencies. However, the political acceptance of such measures is now lower, not least due to international criticism. The result of a new survey therefore comes as no surprise: almost all of the 29 economists surveyed by the Reuters news agency assume that the monetary authorities will not only leave the rate at zero percent at their meeting on Thursday, but will not touch it for the rest of the year. According to economist Sophie Altermatt from Bank Julius Baer, foreign exchange market interventions are the most important instrument for slowing down the currency’s soaring value. <\/p>\n\n\n\n

Escape currency<\/h3>\n\n\n\n

The sober assessment is that the battle for parity is over. Just a few years ago, a EUR\/CHF exchange rate below 1.0 was considered a state of emergency, but today it has become the new normal. The reasons for this lie deeper than short-term interest rate expectations. Rather, the strong franc reflects a fundamental shift in global risk behavior. Investors are looking for security and are finding it in Switzerland. Geopolitical tensions play a central role in this. The war in Ukraine, ongoing conflicts in the Middle East and increasing trade barriers between major economic areas have shaken confidence in many currencies. In this environment, the Swiss franc has established itself as a classic safe haven currency. Added to this is Switzerland’s institutional stability. Solid state financing, political continuity and an efficient financial sector make the currency attractive. But structural factors also contribute to its strength. Switzerland’s current account regularly shows surpluses. At the same time, corporations invest heavily abroad, which leads to reflows into the domestic currency. <\/p>\n\n\n\n

What could happen next? <\/h3>\n\n\n\n

In the short term, much depends on the SNB. If it signals that it will tolerate a further appreciation, the franc could gain additional strength. A clear willingness to intervene, on the other hand, is likely to slow down the FX duo, at least temporarily. From a chart perspective, the EUR\/CHF is in a stable downtrend. Important support zones have already been undercut, with momentum indicators signaling oversold conditions in the short term, which opens up scope for technical recoveries. The next resistance levels on the upside are at CHF 0.92 to 0.94, while on the downside the area between CHF 0.88 and 0.90 could serve as support. In the long term, however, the franc remains a structurally strong candidate. As long as geopolitical uncertainties persist and Switzerland maintains its economic stability, demand is likely to remain high. <\/p>\n\n\n\n

Investment solutions <\/h3>\n\n\n\n

The recent recapture of the CHF 0.90 mark could ensure that the euro remains on a short-term recovery path, especially if the SNB intervenes in the currency market or introduces negative interest rates, either directly or between the lines. In this case, a long speculation on EUR\/CHF could be worthwhile. A suitable product would be the mini future UVVABP<\/a><\/strong> from BNP Paribas. The security has a leverage of 13.3, the knock-out is 5.6% away. The stop-loss level at CHF 0.8559 is below the outlined support level.<\/p>\n\n\n\n

The overall picture, however, points to a depreciation of the euro and an appreciation of the Swiss franc. Such a development can be best analyzed with the Short Mini Future MEUBIV<\/a><\/strong> from Bank Vontobel. The stop loss at CHF 0.9630 allows the currency pair further recovery potential without being stopped out. The leverage is 13.1. Slightly less aggressive is the short EUARSU<\/a><\/strong> from UBS. The knock-out for this open-end product is CHF 0.9933, but the leverage is somewhat lower at 9.3.<\/p>\n\n\n\n

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The SNB faces a complex task: on Thursday, it must strike a balance between price stability, the exchange rate and economic competitiveness. But whatever the central bankers decide, the role of the Swiss franc as a “safe haven” is firmly established. And as long as the world remains uncertain, it is likely to remain in demand. <\/p>\n","protected":false},"author":7,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"ngg_post_thumbnail":0,"footnotes":""},"categories":[222],"tags":[],"class_list":["post-1444406","post","type-post","status-publish","format-standard","hentry","category-trading-desk-en"],"acf":[],"_links":{"self":[{"href":"https:\/\/www.payoff.ch\/en\/wp-json\/wp\/v2\/posts\/1444406","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.payoff.ch\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.payoff.ch\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.payoff.ch\/en\/wp-json\/wp\/v2\/users\/7"}],"replies":[{"embeddable":true,"href":"https:\/\/www.payoff.ch\/en\/wp-json\/wp\/v2\/comments?post=1444406"}],"version-history":[{"count":2,"href":"https:\/\/www.payoff.ch\/en\/wp-json\/wp\/v2\/posts\/1444406\/revisions"}],"predecessor-version":[{"id":1444409,"href":"https:\/\/www.payoff.ch\/en\/wp-json\/wp\/v2\/posts\/1444406\/revisions\/1444409"}],"wp:attachment":[{"href":"https:\/\/www.payoff.ch\/en\/wp-json\/wp\/v2\/media?parent=1444406"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.payoff.ch\/en\/wp-json\/wp\/v2\/categories?post=1444406"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.payoff.ch\/en\/wp-json\/wp\/v2\/tags?post=1444406"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}