Swiss Franc advances against US Dollar after recent sell-off, SNB in focus
USD/CHF extends its pullback on Monday after climbing to 0.8263 last week, its highest level since May 2025.
The Swiss Franc (CHF) experienced a slight gain against the US Dollar (USD) on Monday, following a sell-off last week. The USD/CHF pair retreated to around 0.8209, marking a third consecutive day of decline. Meanwhile, the US Dollar Index (DXY) remained near the seven-week high of 100.56, supported by hawkish expectations from the Federal Reserve (Fed).
The Fed recently raised interest rates by 25 basis points to 3.75%-4.00% and signaled multiple rate hikes this year to combat inflation. In contrast, the Swiss National Bank (SNB) is expected to maintain its policy rate at 0% during its decision on Thursday. Inflation remains low in Switzerland, supporting the SNB's decision. The SNB holds substantial foreign exchange reserves and may intervene to prevent the CHF from appreciating too much against other currencies, which could harm the competitiveness of Swiss exports.
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