CHF/AUD Outlook:
Slightly weaker, but likely to move sideways, as the rate is below the recent average and lacks a clear driver.
Key drivers:
• Rate gap: The Swiss National Bank may consider negative interest rates to weaken the CHF amid a strong currency, while the RBA recently raised rates to tackle inflation, supporting the AUD.
• Safe-haven demand: Global uncertainties continue to draw investors to the CHF, impacting its value against riskier currencies like the AUD.
• Trade impacts: High tariffs on Swiss exports are creating challenges for the Swiss economy, potentially weakening demand for the CHF.
Range:
Expect CHF/AUD to hold within its recent 3-month trading range, as the current factors do not suggest extreme movements.
What could change it:
• Upside risk: A significant improvement in global economic conditions could increase demand for AUD and strengthen it against CHF.
• Downside risk: Further negative developments regarding Swiss exports or renewed hawkish moves from the Swiss National Bank could pressure the CHF higher.