Swiss Franc Weakens to Over 1-Month Low

The Swiss franc depreciated toward 0.785 per USD, reaching the lowest level since January 22, amid the prospect of possible interventions to weaken the currency. The Swiss National Bank said on Monday that, in view of the international situation, it is increasingly prepared to intervene in foreign exchange markets to counter rapid and excessive appreciation of the franc, which would compromise price stability in Switzerland. The franc’s remarkable ascent against major currencies has been fueled by safe-haven flows from ongoing geopolitical tensions. A stronger franc helps curb imported inflation but strains Switzerland’s export-driven economy. Swiss inflation held at 0.1% in January, remaining at the lower end of the SNB’s 0–2% target and in line with the bank’s Q1 outlook. Investors now await February CPI data due on March 4, with analysts forecasting a 0.1% decline in the CPI.

The Swiss franc opened March trading at 0.77 per US dollar, hovering near one of its strongest levels on record. It also surged against the euro, reaching its highest level in more than a decade, as investors flocked to traditional safe-haven assets amid escalating conflict in the Middle East. Over the weekend, the US and Israel launched strikes on Iran, resulting in the reported death of Iran’s Supreme Leader and the effective closure of the Strait of Hormuz. In response, Iran carried out missile and drone attacks across several parts of the region, intensifying geopolitical uncertainty. Meanwhile, the Swiss National Bank indicated it was increasingly willing to intervene in currency markets to curb the franc’s rapid appreciation. Investors are also turning their attention to a series of key economic releases scheduled for this week, including Switzerland’s February inflation data due on Wednesday.

The Swiss franc hovered around 0.77 per USD, approaching record levels, driven by safe-haven flows amid renewed trade uncertainties, geopolitical risks and persistent concerns over AI. President Trump pushed ahead with fresh tariffs on the US’s trading partners despite a supreme court blocked part of planned duties. Switzerland’s low debt, stable economy, and predictable policies further attract investors. Meanwhile, reduced prospects for near-term rate cuts continued to support the currency. Swiss inflation stayed at 0.1% in January, holding at the lower end of the SNB’s 0–2% target range and in line with the bank’s Q1 outlook. The central bank (SNB) is expected to keep the current stance in the foreseeable future, as inflation is seen rising gradually and the bar to reintroduce negative rates remains high. SNB President Martin Schlegel recently stated that the central banks is prepared to accept short periods of negative inflation while keeping focus on medium-term targets.