GBP/CHF Outlook:
Bearish, as the rate is below its recent average and near recent lows.
Key drivers:
• Rate gap: The Bank of England's cautious approach contrasts with the Swiss National Bank's potential for negative interest rates, affecting their respective currencies.
• Safe-haven demand: Ongoing global uncertainties keep the Swiss Franc appealing, as investors seek stability.
• Political uncertainty: The lack of compelling UK data and concerns over leadership challenge in the UK continue to weigh on the British Pound.
Range:
GBP/CHF is expected to drift within a stable range, remaining low based on current pressures.
What could change it:
• Upside risk: A significant and unexpected improvement in the UK’s GDP figures could bolster the pound.
• Downside risk: Heightened geopolitical tensions could increase the demand for the franc, pushing GBP/CHF lower.