The market bias for the NZD to CHF exchange rate is currently range-bound.
Key drivers influencing this situation include the interest rate differential, as the Reserve Bank of New Zealand is expected to cut rates, in contrast to Switzerland's recent monetary tightening from the Swiss National Bank. Meanwhile, fading demand for Swiss exports due to tariffs imposed by the U.S. complicates the economic landscape for the CHF. Additionally, diminishing inflation in Switzerland has led to a more cautious outlook, affecting the attractiveness of the franc.
In the near term, the exchange rate is likely to maintain its relatively stable pattern, trading within its recent range.
Upside risk could arise from a stronger global economic recovery, improving risk sentiment that favors the NZD. Conversely, a sustained appreciation of the CHF driven by ongoing negative market reactions to Swiss tariffs could lead to downward pressure on the NZD.
