The Swiss Franc (CHF) is currently facing significant challenges due to external and internal pressures. Analysts note a detrimental impact from the recent imposition of a 39% tariff on Swiss exports by the U.S., which has already led to a 5.3% decline in Swiss exports in Q2 2025. This tariff not only threatens the stability of the export-driven Swiss economy but also weakened the Swiss Franc against other currencies. The recent reports of the Swiss National Bank (SNB) posting a H1 loss of 15.3 billion Swiss francs, primarily influenced by a weakening U.S. dollar, further accentuate concerns about the currency’s strength. Coupled with the IMF's downgrade of Switzerland's growth forecast to 1.3%, there is an expectation that the CHF may continue facing devaluation pressures in the near term.
Further compounding these negative sentiments, the SNB's decision in June to cut interest rates to zero indicates a shift aimed at countering low inflation and providing support, although it may also reflect a weakening economic outlook. Consequently, the CHF has been trading at 52.03 to the Turkish Lira (TRY), which is 2.6% higher than its three-month average of 50.69. The recent trading ranges indicate a volatility of 8.2%, with fluctuations between 48.50 and 52.48.
On the Turkish Lira side, the outlook appears equally turbulent. Turkey's medium-term economic program forecasts inflation to remain significantly high at 28.5% for 2025, with ambitions for single-digit inflation by 2027. With recent reports from JPMorgan and Goldman Sachs suggesting a decrease in expected interest rate cuts, market reactions are likely to reflect this augmented caution due to persistent inflationary pressures. Political events, such as the unrest following the arrest of opposition leader Ekrem İmamoğlu, have contributed to instability, further impacting investor confidence in the TRY.
Thus, with both currencies facing their respective domestic pressures, the exchange rate of CHF to TRY remains sensitive to both economic and political developments in Switzerland and Turkey. Currency market experts advise keeping a close watch on these evolving dynamics, as fluctuations may create advantageous scenarios for businesses and individuals engaged in international transactions.
