The Swiss franc advanced against the US dollar on Tuesday, pushing the USD/CHF pair below the 0.8200 level during the European session. The move erased nearly 1% of the currency’s gain from last week’s highs around 0.8270.
The broader risk environment also shifted lower for the dollar. The US Dollar Index (DXY) retreated from a two‑month peak of 100.67 but remained above the psychologically important 100.00 threshold. Brent crude oil fell to $94.20, its lowest price in more than two weeks and more than 10% below the previous week’s highs.
In a statement released Tuesday, the Swiss National Bank (SNB) warned that it stands ready to intervene in foreign‑exchange markets “if the need should arise,” citing the ongoing Middle East conflict as a factor that could trigger action. SNB President Martin Schlegel, who earlier noted a modest uptick in inflationary pressures, reaffirmed that price stability – defined as a CPI rise of less than 2% per year – remains within the bank’s target range.
The central bank is expected to keep its benchmark policy rate at 0% when it meets on Thursday, reinforcing the current accommodative stance. Market participants will watch for any sign of a policy shift, although the SNB has signaled that monetary tightening is unlikely until well into 2027.
Separately, Kyodo News reported that Iran has proposed reopening the Strait of Hormuz within seven days after the United States lifts its blockade on Iranian ports. The proposal adds a geopolitical layer to the market’s risk calculus, complementing the SNB’s cautionary remarks.
Overall, the franc’s recovery reflects a blend of technical support in the USD/CHF pair, a modest pullback in dollar strength, and heightened vigilance from the SNB amid external geopolitical tensions.
