The Swiss franc strengthened against the U.S. dollar in Asian trading Monday, with USD/CHF near 0.8230 as futures pricing pointed to a Federal Reserve hold this week.
FXStreet quoted USD/CHF at about 0.8230 at 11:45 p.m. ET Sunday (03:45 GMT Monday). Investing.com’s daily series showed a 0.56% rise on Oct. 23 to 0.8251. The Monday snapshot was below Friday’s reported close. An earlier EconoTimes report on Friday’s dollar gain against the franc covered that advance.
The CME FedWatch Tool showed a 90.6% probability of no rate change at the Fed’s Oct. 27-28 meeting, a figure also displayed in OANDA’s Oct. 26 table. The CME tool derives its probabilities from federal funds futures, so the figure reflects market pricing rather than a settled policy decision. It does not by itself explain the exchange rate’s move.
The Swiss National Bank’s Governing Board left its policy rate at 0% at its Sept. 22-23 assessment, according to a summary published Oct. 22. The bank said the franc had lost about 3% since June on a trade-weighted basis. In the SNB’s account, using francs to finance carry trades became more attractive as the rate gap widened and currency swings remained muted.
The central bank also said safe-haven demand for the franc had been limited during that period and that the weaker currency probably supported Swiss economic growth in recent months. Swiss inflation was 0.8% in August, mainly reflecting higher prices for oil products. The SNB reported few signs of second-round effects and said core inflation had risen only slightly.
The SNB summary describes the franc’s performance since June, while the latest quote is a separate market snapshot. The next scheduled central bank decision relevant to the dollar-franc market is the Fed’s meeting on Oct. 27-28.
