Foreign exchange markets in the political arena

EUR/USD (24.11.2025: 1.15)

The pair remains strongly characterized by monetary policy divergence. While the ECB is already in a cycle of interest rate cuts due to moderate inflation, the US Federal Reserve remains cautious. The robust US economy is supporting the dollar in the short term, while the interest rate differential should tend to narrow beyond 2025. Sentiment remains data-driven, particularly due to US inflation and geopolitical risks.

Conclusion (12 months): Slightly euro-friendly trend, but trading range remains volatile - expectation: moderately higher EUR, but no clear trend break.

EUR/CHF (24.11.2025: 0.93)

The euro against the Swiss franc mainly reflects SNB policy. Following the SNB's interest rate cuts, the franc has weakened somewhat, but remains structurally strong as Switzerland continues to act as a safe haven. Low inflation allows the SNB to maintain its dovish stance, but geopolitical uncertainties are limiting a sustained depreciation of the CHF.

Conclusion (12 months): Basically sideways, with occasional swings in favor of the franc - expectation: stable range, with a slight CHF bias in periods of stress.

USD/CHF (24.11.2025: 0.81)

The dollar will remain firm against the franc as long as the Fed remains tighter on monetary policy than the SNB. However, the high level of geopolitical uncertainty regularly ensures safe-haven inflows into the CHF. The pair thus remains a balancing act between interest rate differentials (per USD) and risk aversion (per CHF).

Conclusion (12 months): Trend slightly USD-positive due to the interest rate differential, but repeated setbacks in risk aversion -Expectation: volatile sideways with a slight USD advantage.

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Mimi Haas, Lic. rer.pol. HSG, M.A. in Banking and Finance HSG, Partner

_{Sources: MarketMap and Bloomberg}

_{Status:24.11.2025}