USD/CHF pushed to its highest level since May 2025 after the Swiss National Bank held its policy rate at 0% and softened its language on franc intervention. The move builds on a broader dollar advance tied to rising US yields and firming Fed hike bets, while a daily-chart support zone continues to hold beneath the pair.
SNB holds at zero, softens franc language
The Swiss National Bank left its policy rate unchanged at 0%, as expected, while nudging its inflation forecasts slightly higher. The bank still expects inflation to average just 0.8% in both 2027 and 2028, even as higher energy prices lift near-term readings.
According to investingLive: an “increased willingness” to intervene in the foreign exchange market was dropped from the SNB's language, replaced by a statement that it is willing to be active as necessary. Intervention remains on the table, but the shift suggests less urgency about franc strength. The franc weakened after the decision, with EURCHF moving from around 0.9380 to 0.9420.
Fed repricing widens the rate gap
The SNB's steady hand contrasts with a Fed that has left the door open to further tightening. Odds of an October Fed rate hike rose to 77.5%, from roughly 53% a day earlier and under 10% a month ago, pushing the 10-year Treasury yield to around 5.14%, its highest since 2007. Higher US yields make dollar assets more attractive relative to franc assets, reinforcing the fundamental case behind the pair's advance.
Buyers defend support, eye the May 2025 high
On the daily chart, USDCHF dipped Monday and into Tuesday, but the decline found buyers within a swing area between 0.81706 and 0.82148, a zone that also contains the 38.2% retracement of the decline from the January 2025 high to the January 2026 low, at 0.82116.
Support held. A sharp rise in US yields then helped push USDCHF above the top of that swing area, and the pair has since extended above its earlier September highs near 0.8265. The next upside target is the late-May 2025 high near 0.8348, which would put the 50% retracement of the January 2025-to-January 2026 decline in focus if cleared.
On the downside, a move back below 0.82116 would be an initial warning the breakout is losing strength, while a fall below the swing area low at 0.81706 would mark a more consequential shift for buyers who leaned on that support.
Sources: investingLive, ActionForex
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