Swiss Franc: BNS seems more tolerant of the strength of the CHF

In a lengthy interview published yesterday, the Governor of the Swiss National Bank (BNS), Martin Schlegel, showed a more tolerant attitude towards the strength of the Swiss franc, as highlighted by currency analyst Chris Turner from ING.

Comments increase the likelihood that EUR/CHF will retest 0.9220

"This occurs at a time when EUR/CHF is trading near 0.93 and USD/CHF below 0.80 – in other words, a period of very strong nominal Swiss franc and when overall inflation is just 0.2% year-on-year. Two comments stood out in the interview."

"The first was that there is a high threshold for reintroducing negative interest rates. The policy rate of the BNS is currently zero and the next meeting will be on September 25. The second was that 'considering that prices, and therefore costs for businesses, are rising significantly faster in other countries, the real appreciation is not as significant as it seems at first glance.' Schlegel's comments are somewhat surprising given that the real Swiss franc is now at highs from early 2024 – a time when the BNS adopted a more moderate stance."

"We interpret these comments as indicating that the BNS is a bit more relaxed regarding the strength of the Swiss franc, a cut to negative rates seems further away, and in a world where politics and debt sustainability play a larger role in currency markets, it appears more favorable to long strategic positions in Swiss franc. These comments make it more likely that EUR/CHF will retest this year's lows at 0.9220."

For reference, according to current market data, 225 Swiss francs are approximately equivalent to €240.98 at the exchange rate prevailing at the end of September 2025.

Note: This information is for informational purposes only. Past performance is not indicative of future results.