Is the Swiss Franc still worth investing in? Analyzing exchange rate fluctuations to understand the Swiss Franc's trend

Risk Assets Fall Out of Favor, Swiss Franc Becomes “Safe Haven” Darling

Since 2025, the global financial markets have been filled with uncertainty. Trump’s tariff policies have sparked trade war expectations, leading to widespread sell-offs of various risk assets and a rapid flow of funds into traditional safe-haven assets. Amid this wave of “flight to safety,” the Swiss franc (CHF), with its stability and historical reputation, has become a market favorite.

Looking at the data, USD/CHF has dropped sharply from 0.9078 at the start of the year to around 0.8, with the franc appreciating over 10% against the dollar. This upward trend mainly began in April, right after Trump announced the “reciprocal tariffs.” According to CoinCodex forecasts, USD/CHF may further decline to the 0.7458-0.8452 range, indicating that the strong franc pattern will be difficult to break in the short term.

The Three Main Drivers Behind the Swiss Franc’s Movement

The Swiss National Bank’s “Double-Edged Sword”

The Swiss National Bank (SNB)’s actions directly influence the CHF exchange rate. To ease the economic pressure from rapid currency appreciation, the SNB lowered its policy interest rate to 0% in June 2025, hitting a new low since ending negative rates at the end of 2022. While this looks like a dovish move, in reality, the SNB is engaging in “easing” — trying to curb excessive franc buying through accommodative policies.

However, investors should be cautious, as the SNB has a history of aggressive interventions in the forex market. The 2015 “Swiss franc black swan” event still lingers in market memory. If global risk sentiment deteriorates again, the SNB may once more deploy its “visible hand” to intervene more directly in the currency.

The “Twin” Characteristics of Gold and the Swiss Franc

Switzerland holds 1,040 tons of gold reserves, ranking among the top globally on a per capita basis. As a safe-haven asset, both the franc and gold tend to strengthen simultaneously during periods of extreme panic. After the 2008 financial crisis, both experienced long-term rallies; around 2011, they peaked at the same time. This correlation is not coincidental but reflects that, during market panic, capital floods into physical precious metals and safe-haven currencies alike.

The “Stress Response” to Global Economic Cooling

The International Monetary Fund (IMF) forecasts that global GDP growth in 2025 will be only 2.8%, below previous years. Coupled with escalating trade tensions and instability in Europe, market concerns about economic prospects continue to rise. Against this backdrop, investors naturally favor low-risk assets — with the franc becoming the top choice.

Technical Perspective on the Swiss Franc’s Trend

USD/CHF: The Downtrend Is Not Over

Since triggering a decline in April, USD/CHF has maintained a downward trajectory. The market generally remains bearish on this currency pair, believing the franc’s appreciation wave is far from over. CoinCodex data suggests that USD/CHF could fall another 4.73% in the next month, approaching lower support levels.

EUR/CHF: Choppy Decisions

The EUR/CHF trend is more complex. Early in the year, the European Central Bank (ECB)’s delay in rate cuts boosted the euro, pushing EUR/CHF up to 0.9676. But in the second quarter, as the eurozone economy weakened and global trade risks increased, demand for the safe-haven franc surged, causing the pair to drop sharply back toward 0.94.

Key future points to watch: if the ECB maintains a hawkish stance or eurozone data exceeds expectations, EUR/CHF could rise; conversely, if geopolitical risks worsen or the SNB intervenes again, the pair could fall below 0.90.

How Can Ordinary Investors Participate in the Swiss Franc Trend?

For retail investors, there are three main ways to invest in the franc:

Bank Counter Trading: The most traditional but least efficient, with high spreads, unsuitable for short- to medium-term trading.

Futures Trading: Conducted through exchanges like CME, offering flexible leverage and longer trading hours, but requiring periodic rollover and higher trading thresholds.

CFD Trading: Combining the advantages of futures with greater simplicity, low margin requirements, and unlimited holding periods, making it very suitable for retail investors. Whether it’s USD/CHF, EUR/CHF, or other Swiss franc crosses, investors can choose freely.

Trading Tips: The best trading times are during the overlap of European and US sessions (Beijing time 9 PM to 2 AM, with daylight saving time extended by 1 hour). Liquidity is highest, and volatility is most active then.

Conclusion: The Swiss Franc as a Hedge Tool, Not a Growth Asset

The movement of the Swiss franc is essentially a contest between “risk assets vs. safe assets.” In the short term, the franc’s volatility is driven by central bank policies and economic data; in the long term, it depends on whether the world will face another crisis.

For investment portfolios, the value of the franc lies not in appreciation but in its role as insurance. In the current environment of the Fed’s rate hike cycle nearing its end and frequent banking system crises worldwide, allocating to the franc is akin to adding a form of insurance to your portfolio. If major global risks persist in the coming years, the franc will inevitably become an indispensable part of investment holdings.