Why is the Swiss franc reaching decade highs in early 2026?

The Swiss franc has surged due to widespread global uncertainty, which typically drives investors towards safe haven assets like the franc.

How does a strong Swiss franc affect the Swiss economy?

A strong franc complicates monetary policy, lowers imported inflation, squeezes exporters' margins, and can weigh on wages and investment, especially when inflation is already subdued.

What actions can the Swiss National Bank take regarding the franc?

The Swiss National Bank can adjust its policy rate, potentially returning to negative rates if necessary, and may intervene in the foreign exchange market by selling the franc.

Home / Business and Economy / Swiss Franc Soars: Global Fears Boost Safe Haven

Swiss Franc Soars: Global Fears Boost Safe Haven

28 Jan

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Summary

Swiss franc hits decade highs amid global uncertainty.
Low inflation and a strong franc complicate SNB policy.
Switzerland wary of US tariffs and trade policy shifts.

Swiss Franc Soars: Global Fears Boost Safe Haven

The Swiss franc has reached decade highs in early 2026, propelled by widespread global uncertainty. This safe haven currency has gained significantly against the U.S. dollar, touching an 11-year high. Policymakers are observing this trend with apprehension, as a stronger franc poses challenges.

A strengthening franc exacerbates disinflationary pressures in Switzerland's export-driven economy. With inflation at a mere 0.1% and the SNB's policy rate at 0%, the country is nearing negative interest rate territory.

This situation complicates the Swiss National Bank's (SNB) task. A strong franc lowers imported inflation and squeezes exporters' margins, potentially impacting wages and investment. The SNB previously ended seven years of negative rates in 2022 but is prepared to return if necessary.