Snapshot: The Swiss Franc is trading firmly near 0.8000 against the dollar, underpinned by the SNB’s decision to hold rates steady and a sudden, massive surge in safe-haven demand. Today’s major catalyst is the abrupt cancellation of the US-Iran peace summit in Switzerland following Israeli strikes on Lebanon, which has triggered immediate risk-off positioning.
- The Swiss National Bank’s decision to leave its policy rate unchanged at 0% while upgrading its inflation forecasts for 2027 and 2028 provides a sturdy fundamental floor for the Franc, reinforced by active FX intervention readiness.
- Speculators remain moderately short at the 29th percentile (-36,665 contracts), creating a prime setup for a severe short-covering squeeze as geopolitical headlines flash and warning shots are fired in the Strait of Hormuz.
Bias into NY: We are buyers of the Swissy into the New York open, targeting a clean break below 0.8000 in USD/CHF. Safe-haven flows and a hawkish-leaning SNB policy shift will easily override any pressure from rising US yields ahead of the morning data print.