Select Language

USD/CHF trades above 0.7950 after paring losses due to potential for US-China deals

Breaking news

USD/CHF trades above 0.7950 after paring losses due to potential for US-China deals

  • X
  • facebook
  • LINE
  • RSS

  • X
  • facebook
  • LINE
  • RSS
New update 2025.10.27 14:23
USD/CHF trades above 0.7950 after paring losses due to potential for US-China deals

update 2025.10.27 14:23

  • USD/CHF recovers its daily losses as the US Dollar gains on easing trade tensions between the US and China.
  • Softer US inflation data support a higher likelihood of Federal Reserve rate cuts.
  • The Swiss Franc may gain ground as the SNB's Meeting Minutes dismissed the possibility of further policy easing.

USD/CHF depreciates after opening with a gap up, trading around 0.7960 during the Asian hours on Monday. The pair recovers its daily losses as the US Dollar (USD) gains ground on rising hopes that Presidents Donald Trump and Xi Jinping may finalize a trade deal on Thursday in South Korea.

US Treasury Secretary Scott Bessent said that President Trump's threat to impose 100% tariffs on Chinese goods "is effectively off the table." Bessent added that China has agreed to make "substantial" soybean purchases and to postpone its rare-earth export controls "for a year while they re-examine it," per CBS News.

However, the upside of the US Dollar could be limited as softer US inflation data helps in keeping the likelihood of the Federal Reserve (Fed) rate cuts higher. The CME FedWatch Tool indicates that markets are now pricing in nearly a 97% chance of a Fed rate cut in October and a 96% possibility of another reduction in December.

The US Bureau of Labor Statistics (BLS) reported on Friday that the US Consumer Price Index (CPI) rose 3.0% year-over-year (YoY) in September, following a 2.9% increase in the prior month. This reading came in below the market expectation of 3.1%. Meanwhile, the monthly CPI increased 0.3%, against the 0.4% rise seen in August.

The Swiss Franc (CHF) could receive support from reduced expectations of further policy easing by the Swiss National Bank (SNB). Minutes from the SNB's September policy meeting showed that the Swiss central bank downplayed deflation risks and dismissed the possibility of returning to negative rates. The SNB noted that its monetary policy remains expansionary, with the full impact of previous easing measures still unfolding.

Swiss Franc FAQs

The Swiss Franc (CHF) is Switzerland's official currency. It is among the top ten most traded currencies globally, reaching volumes that well exceed the size of the Swiss economy. Its value is determined by the broad market sentiment, the country's economic health or action taken by the Swiss National Bank (SNB), among other factors. Between 2011 and 2015, the Swiss Franc was pegged to the Euro (EUR). The peg was abruptly removed, resulting in a more than 20% increase in the Franc's value, causing a turmoil in markets. Even though the peg isn't in force anymore, CHF fortunes tend to be highly correlated with the Euro ones due to the high dependency of the Swiss economy on the neighboring Eurozone.

The Swiss Franc (CHF) is considered a safe-haven asset, or a currency that investors tend to buy in times of market stress. This is due to the perceived status of Switzerland in the world: a stable economy, a strong export sector, big central bank reserves or a longstanding political stance towards neutrality in global conflicts make the country's currency a good choice for investors fleeing from risks. Turbulent times are likely to strengthen CHF value against other currencies that are seen as more risky to invest in.

The Swiss National Bank (SNB) meets four times a year - once every quarter, less than other major central banks - to decide on monetary policy. The bank aims for an annual inflation rate of less than 2%. When inflation is above target or forecasted to be above target in the foreseeable future, the bank will attempt to tame price growth by raising its policy rate. Higher interest rates are generally positive for the Swiss Franc (CHF) as they lead to higher yields, making the country a more attractive place for investors. On the contrary, lower interest rates tend to weaken CHF.

Macroeconomic data releases in Switzerland are key to assessing the state of the economy and can impact the Swiss Franc's (CHF) valuation. The Swiss economy is broadly stable, but any sudden change in economic growth, inflation, current account or the central bank's currency reserves have the potential to trigger moves in CHF. Generally, high economic growth, low unemployment and high confidence are good for CHF. Conversely, if economic data points to weakening momentum, CHF is likely to depreciate.

As a small and open economy, Switzerland is heavily dependent on the health of the neighboring Eurozone economies. The broader European Union is Switzerland's main economic partner and a key political ally, so macroeconomic and monetary policy stability in the Eurozone is essential for Switzerland and, thus, for the Swiss Franc (CHF). With such dependency, some models suggest that the correlation between the fortunes of the Euro (EUR) and the CHF is more than 90%, or close to perfect.


Date

Created

 : 2025.10.27

Update

Last updated

 : 2025.10.27

Related articles


Show more

FXStreet

Financial media

arrow
FXStreet

FXStreet is a forex information website, delivering market analysis and news articles 24/7.
It features a number of articles contributed by well-known analysts, in addition to the ones by its editorial team.
Founded in 2000 by Francesc Riverola, a Spanish economist, it has grown to become a world-renowned information website.

Was this article helpful?

We hope you find this article useful. Any comments or suggestions will be greatly appreciated.  
We are also looking for writers with extensive experience in forex and crypto to join us.

please contact us at [email protected].

Thank you for your feedback.
Thank you for your feedback.

Most viewed

FX option expiries for Oct 27 NY cut

FX option expiries for Oct 27 NY cut at 10:00 Eastern Time via DTCC can be found below.
New
update2025.10.27 16:29

When is the German IFO Survey and how it could affect EUR/USD?

Germany's IFO institute will publish its business survey for October on Monday at 0900 GMT. The headline IFO Business Climate Index is expected to edge higher to 87.8 this month, from a 87.7 reading in September.
New
update2025.10.27 16:21

Crude Oil price today: WTI price bullish at European opening

West Texas Intermediate (WTI) Oil price advances on Monday, early in the European session. WTI trades at $61.57 per barrel, up from Friday's close at $61.29.Brent Oil Exchange Rate (Brent crude) is stable, hovering around its previous daily close at $65.17.
New
update2025.10.27 16:03

NZD/USD holds positive ground above 0.5750 on US-China trade deal progress

The NZD/USD pair holds positive ground near 0.5765 during the early European session on Monday. Easing tensions over the US-China trade tensions between the US and China provides some support to the New Zealand Dollar (NZD) against the US Dollar (USD).
New
update2025.10.27 15:59

Forex Today: Mood improves on US-China trade deal optimism

Here is what you need to know on Monday, October 27:
New
update2025.10.27 15:24

US President Donald Trump: I don't want to meet with Canadian PM Carney

US President Donald Trump said on Monday that he doesn't want to meet with the Canadian Prime Minister Mark Carney, adding that he's very happy with the deal the US has with Canada now.
New
update2025.10.27 15:18

GBP/JPY Price Forecast: Refreshes two-week high near 204.00, BoJ's policy outcome awaited

The GBP/JPY pair posts a fresh two-week high near 204.00 on Monday, and trades 0.25% higher during the early European session.
New
update2025.10.27 15:03

EUR/USD Price Forecast: Keeps bullish vibe above 1.1600 despite France's deepening political crisis

The EUR/USD pair loses ground to near 1.1620 during the early European session on Monday. The Euro (EUR) softens against the US Dollar (USD) amid fears of political turmoil in France.
New
update2025.10.27 14:45

USD/CHF trades above 0.7950 after paring losses due to potential for US-China deals

USD/CHF depreciates after opening with a gap up, trading around 0.7960 during the Asian hours on Monday. The pair recovers its daily losses as the US Dollar (USD) gains ground on rising hopes that Presidents Donald Trump and Xi Jinping may finalize a trade deal on Thursday in South Korea.
New
update2025.10.27 14:22

EUR/GBP edges lower to 0.8730; lacks follow-through amid BoE-ECB policy divergence

The EUR/GBP cross kicks off the new week on a softer note and moves further away from a nearly one-month high, around the 0.8745-0.8750 supply zone, touched on Friday.
New
update2025.10.27 14:17

Disclaimer:arw

All information and content provided on this website is provided for informational purposes only and is not intended to solicit any investment. Although all efforts are made in order to ensure that the information is correct, no guarantee is provided for the accuracy of any content on this website. Any decision made shall be the responsibility of the investor and Myforex does not take any responsibility whatsoever regarding the use of any information provided herein.

The content provided on this website belongs to Myforex and, where stated, the relevant licensors. All rights are reserved by Myforex and the relevant licensors, and no content of this website, whether in full or in part, shall be copied or displayed elsewhere without the explicit written permission of the relevant copyright holder. If you wish to use any part of the content provided on this website, please ensure that you contact Myforex.

  • Facebook
  • Twitter
  • LINE

Myforex uses cookies to improve the convenience and functionality of this website. This website may include cookies not only by us but also by third parties (advertisers, log analysts, etc.) for the purpose of tracking the activities of users. Cookie policy

I agree
share
Share
Cancel