The Chairman of the Swiss National Bank (SNB), Martin Schlegel, anticipates a slight rise in inflation in the coming quarters. Global growth is currently being impacted by US tariffs.<\/p>\n
Interest rates are expected to stay unchanged for a considerable period. The possibility of reverting to a negative interest rate policy is quite low according to Schlegel.<\/p>\n
The USD\/CHF currency pair has stabilised around 0.8100, a level last observed over two months ago. The SNB’s policy decisions are aimed at maintaining medium and long-term price stability, defining this as a Swiss Consumer Price Index rise of less than 2% per year.<\/p>\n
Interest rate adjustments are determined by the SNB’s price stability objective. When inflation forecasts exceed this target, a rate increase can make the Swiss Franc more appealing due to improved yields.<\/p>\n
The SNB intervenes in the foreign exchange market to prevent excessive appreciation of the Swiss Franc. Interventions usually involve purchasing foreign currencies to maintain competitiveness for Swiss exports.<\/p>\n
The SNB Governing Council conducts monetary policy assessments quarterly. Decisions are made during meetings in March, June, September, and December, accompanied by medium-term inflation forecasts.<\/p>\n
We see the Swiss National Bank signaling that interest rates will likely remain unchanged for a long time. While they expect inflation to pick up in the coming quarters, the message is that the bar for a rate hike is high. With the policy rate holding steady at 1.50% since the September 2025 meeting, we should not expect any sudden moves before their next decision in December.<\/p>\n
This stable interest rate environment suggests that volatility in the Swiss Franc could remain low. We’ve seen 3-month implied volatility on USD\/CHF options fall below 5.5%, which is near the lowest levels we have seen since before the rate hiking cycle of 2022-2023. This points towards range-bound trading, likely keeping the pair between 0.8000 and 0.8250 in the near term.<\/p>\n
For derivative traders, this outlook makes selling volatility an attractive strategy. With the SNB on the sidelines, collecting premium through short straddles or strangles on currency pairs like USD\/CHF and EUR\/CHF could be profitable. These positions benefit from the passage of time and the expected lack of any major directional breakout.<\/p>\n
The main risk to this view is a surprise jump in inflation, which would force the SNB to reconsider its stance. While the latest October 2025 CPI reading came in at a manageable 1.7%, we remember how quickly inflation accelerated back in 2022. Any data suggesting a move above the 2% target could unwind these short volatility positions very quickly.<\/p>\n
We also need to watch the global growth picture, especially with ongoing US tariff discussions. A significant slowdown, evidenced by recent weak manufacturing PMI data from Germany, could trigger a flight to safety. In the past, such events have caused rapid strengthening of the Swiss Franc, which would challenge the view of a stable range for USD\/CHF.<\/p>\n
Create your live VT Markets account<\/a>\u00a0and\u00a0start trading<\/a>\u00a0now. <\/b><\/p>\n","protected":false},"excerpt":{"rendered":" SNB expects modest inflation rise; interest rates to remain steady; low chance of negative rates returning.<\/p>\n","protected":false},"author":5,"featured_media":17026,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[3],"tags":[],"class_list":["post-33979","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-live-updates"],"acf":{"acf_article_selection_author":null},"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.vtmarkets.com\/sv-eu\/wp-json\/wp\/v2\/posts\/33979","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.vtmarkets.com\/sv-eu\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.vtmarkets.com\/sv-eu\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/sv-eu\/wp-json\/wp\/v2\/users\/5"}],"replies":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/sv-eu\/wp-json\/wp\/v2\/comments?post=33979"}],"version-history":[{"count":0,"href":"https:\/\/www.vtmarkets.com\/sv-eu\/wp-json\/wp\/v2\/posts\/33979\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/sv-eu\/wp-json\/wp\/v2\/media\/17026"}],"wp:attachment":[{"href":"https:\/\/www.vtmarkets.com\/sv-eu\/wp-json\/wp\/v2\/media?parent=33979"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/sv-eu\/wp-json\/wp\/v2\/categories?post=33979"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/sv-eu\/wp-json\/wp\/v2\/tags?post=33979"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}