After a period of relative under-performance, signs are emerging that it may be gearing up for a renewed rally — with major implications for pairs such as USD/CHF and EUR/CHF.
Key Drivers
Yield differentials and safe-haven flows
The movement of USD/CHF remains tightly linked to U.S. yields and risk sentiment. As traders weigh the outlook for U.S. interest rates and the attractiveness of “safe-haven” currencies, CHF is back in focus.
When U.S. yields rise, USD tends to gain — weakening CHF in pairs like USD/CHF. By contrast, lower yields or heightened risk aversion can boost the franc.
Trade policy and tariffs
The prospect of renewed trade tensions — especially involving the U.S. — may revive demand for safe-haven currencies like CHF. A stronger franc adversely affects Swiss exporters and imports, complicating the position of the Swiss National Bank (SNB).
Technical picture is shifting
On the charts, USD/CHF and EUR/CHF are exhibiting patterns that suggest the franc might reclaim some ground. For example:
USD/CHF has pulled back from a recent breakout, and its resistance/support zones are being tested.
EUR/CHF has bounced to multi-month highs, suggesting the franc may be under pressure against the euro — but that could reverse if sentiment shifts.
What to Watch
U.S. inflation and central-bank policy: With major inflation data on the horizon, traders are watching how this influences U.S. rate expectations. A stronger-than-expected inflation print could boost USD, weighing on CHF pairs; a weaker print might tilt things in favour of the franc.
Trade-tariff developments: Any renewed threat or escalation of tariffs may spark safe-haven flows into CHF — strengthening it, especially versus USD and EUR.
Chart levels: For USD/CHF, key resistance is around the 0.8150-0.8200 zone, and the trend will remain vulnerable so long as price hovers below that.
Possible Scenarios
If USD strengthens: Should U.S. inflation surprise on the upside and push yields higher, USD/CHF may move up — meaning the franc weakens in that pair.
If risk rises / USD weakens: In a risk-off scenario or if yields sink, the franc could rally — pulling USD/CHF lower and strengthening CHF.
Range-bound if uncertain: With both major drivers (yields & trade policy) in flux, we might see the franc oscillating without a firm trend — making the 0.7940-0.8200 zone (roughly for USD/CHF) important.
Outlook
For now, the stage is set for the franc to re-emerge as a meaningful currency to watch. The combination of possible tariff shocks, safe-haven flows and key technical levels means that traders and analysts should not ignore CHF.
That said, it’s not a guaranteed comeback — much depends on how U.S. macro data and trade developments evolve. The technical charts suggest caution: bullish setups exist, but they need confirmation.
Keep an eye on those inflation prints, tariff headlines, and whether USD/CHF breaks above resistance or fails and rolls over. If the franc starts to assert strength again, it could prompt the SNB to respond — especially since a rising franc and weak inflation pose policy risks for Switzerland.