Swiss 10-Year Yield Near 2-Month High

Switzerland's 10-year government bond yield rose above 0.45%, further increasing to a near two-month high, as escalating tensions in the Middle East lifted inflation expectations. Oil prices surged amid intensifying hostilities between the US and Iran, raising energy costs and prompting markets to reassess the outlook for inflation, economic growth, and monetary policy. The Swiss National Bank left its key policy rate unchanged at 0% at its latest meeting, expecting inflation to remain little changed in the medium term. However, meeting minutes highlighted that policymakers see rising geopolitical tensions as a near-term inflation risk. The SNB also reiterated its willingness to intervene in the foreign exchange market to counter excessive franc appreciation and preserve price stability, while the IMF urged the central bank to remain cautious should a stagflation scenario emerge.

Switzerland's 10-year government bond yield rose above 0.40%, reaching its highest level in a month after touching a nearly four-month low of 0.25% on June 26th, as escalating geopolitical tensions heightened concerns over oil supply disruptions and inflation risks. US-Iran tensions persisted after Washington revoked the 60-day waiver allowing Iran to sell crude and ended the ceasefire. Meanwhile, President Donald Trump said the Strait of Hormuz remained open to commercial shipping, while Tehran claimed it had closed the waterway after intercepting two vessels it said were using an unauthorized route, adding to uncertainty over global energy supplies and boosting safe-haven demand. The Swiss National Bank left its policy rate unchanged at 0% and reiterated its willingness to intervene in foreign exchange markets to curb excessive franc appreciation. Swiss inflation eased to 0.5% in June, the first slowdown in eight months, with the SNB forecasting 0.6% inflation in 2026.

Switzerland’s 10-year government bond yield rose above 0.37%, rising to over a three-week high, as renewed geopolitical tensions and higher oil prices fuelled inflation concerns. Oil surged after the US and Iran exchanged airstrikes following vessel attacks near the Strait of Hormuz, raising fears of supply disruptions. The US revoked the 60-day waiver that allowed Iran to sell crude and US President Trump stated that, as far as he is concerned, the ceasefire is over, reducing hopes for a lasting agreement. Meanwhile, the Swiss National Bank left its policy rate unchanged at 0% and reiterated its willingness to intervene in foreign exchange markets to limit excessive franc appreciation and contain imported inflation. Swiss inflation eased to 0.5% in June, the first slowdown in eight months. The reading came within the SNB’s target range, who expect inflation to gradually pick up over the course of the year, averaging 0.6% in 2026.