Swiss Franc edges lower after SNB leaves rates unchanged as expected

USD/CHF returns to levels beyond 0.8000, nearing two-and-a-half-month highs, at 0.8015.
The SNB has left rates unchanged at 0% and hints at a steady monetary policy in the mid-term.
The US Dollar holds gains following a "hawkish hold by the Fed on Wednesday.

Guillermo Alcala FXStreet

The Swiss Franc gives away previous gains against the US Dollar (USD) with the USD/CHF pair turning positive on daily charts as the Swiss National Bank (SNB) confirmed its decision to leave rates unchanged. The pair has popped up above 0.8000 following the interest rate decision, approaching two-and-a-half-month highs at 0.8015.

The Swiss central bank has left its benchmark interest rate steady at 0% for the twelfth consecutive time, as it was widely expected. The bank’s statement acknowledges a recent uptick in inflation due to higher energy prices, yet with medium-term inflationary pressures virtually unchanged, which suggests that the monetary policy is unlikely to change in the coming months

The SNB Chairman, Martin Schlegel, is speaking to the press at the time of writing, providing further details about the bank’s economic forecasts and the monetary policy outlook.

Earlier on the day, data released by Swiss customs revealed that the Trade Balance surplus widened to CHF 6.11 billion in May, doubling up April’s CHF 3.05 billion surplus. The figures provided mild support to the Swissie at the European session opening.

The Swiss Franc dropped more than 0.8% on Wednesday as a hawkishly-leaning Federal Reserve (Fed) sent the US Dollar rallying across the board. The Fed kept interest rates on hold in the first meeting under Kevin Warsh, but the new chairman cleared doubts about his commitment to bring inflation under control, while the dot plot showed that half of the committee members see at least one rate hike before the year-end.

Economic Indicator

SNB Interest Rate Decision

The Swiss National Bank (SNB) announces its interest rate decision after each of the Bank’s four scheduled annual meetings, one per quarter. Generally, if the SNB is hawkish about the inflation outlook of the economy and raises interest rates, it is bullish for the Swiss Franc (CHF). Likewise, if the SNB has a dovish view on the economy and keeps interest rates unchanged, or cuts them, it is usually bearish for CHF.

Economic Indicator

SNB Press Conference

The Swiss National Bank (SNB), led by the Chairman of the Governing Board, holds a press conference after each of its quarterly meetings, held in March, June, September and December, when it takes decisions on interest rates and formulates economic forecasts for the future. The press conference has two parts – first a prepared statement is read out, then the conference is open to questions from the press. The questions often lead to unscripted answers that create market volatility. Hawkish comments tend to boost the Swiss Franc (CHF), while a dovish message tends to weaken it.

160.80: Japanese Yen remains close to nearly two-year lows

USD/JPY inches lower after four days of gains, trading around 160.60 during the Asian hours. The USD/JPY pair surged to 160.80 the previous day, marking its highest level since July 2024 and significantly heightening speculation that Japanese authorities could soon intervene to support the struggling Yen.

AUD/USD eyes 0.7050 on weaker USD; 100-day SMA holds the key for bulls

The AUD/USD pair regains positive traction during the Asian session, reversing part of the previous day's slide to sub-0.7000 levels, or the weekly low. Spot prices currently trade around the 0.7040 region, up nearly 0.40% for the day, amid a broadly weaker US Dollar.

Gold stays firm near $4,300 as Iran peace deal offsets hawkish Fed

Gold clings to its modest intraday gains in the European session on Thursday and hangs close to the $4,300 mark amid a broadly weaker US Dollar (USD). The optimism over a US-Iran peace deal prompts USD profit-taking and supports the bullion. The Fed’s hawkish tilt could limit USD losses, capping the commodity.

Bitcoin slips below $64,000 as hawkish Fed stance weighs on risk appetite

Bitcoin remains under pressure, extending its correction, trading below $64,000. The US Federal Reserve left interest rates unchanged but struck a hawkish tone on Wednesday, dampening the risk sentiment.

Bank Indonesia increases rates by 25 basis points in June: Will it defend the Rupiah?

Bank Indonesia decided to hike the benchmark interest rate by 25 basis points to 5.75% on June 18, from the previous 5.5%. The decision aligned with the market expectations. The Indonesian Rupiah receives support against the US Dollar as an immediate reaction to the BI interest rate decision. The USD/IDR is trading around 17,820.

Regime change: Inside Kevin Warsh's first move to make the Fed unreadable on purpose

The rate did not move. That was the least interesting thing about Kevin Warsh's first meeting in charge of the Fed. The FOMC held its benchmark at 3.50%-3.75% for the fourth straight meeting, exactly as priced, and then the new chair used his first press conference to dismantle the machinery the market has leaned on for a decade.