The GBP to CHF exchange rate shows a bearish bias, with significant uncertainty looming.
Key factors include the interest rate differential, as the Bank of England plans gradual rate cuts, while the Swiss National Bank maintains a 0% policy rate with potential for negative rates if the franc strengthens. Additionally, the UK's economic growth is forecasted to slow, influenced by stagnant incomes and constrained public spending. Conversely, Switzerland's low inflation and trade balance challenges from tariffs impact the franc’s value.
The near-term trading range is expected to remain stable, around recent levels, reflecting low volatility. Recent price data indicates the GBP is slightly above its three-month average. Upside risks could arise if geopolitical tensions escalate, increasing demand for GBP as a safe alternative. On the downside, further deterioration in the UK’s economic outlook or a strengthening of the franc could push the GBP lower against the CHF.
