SGD/CHF Outlook:
The SGD/CHF pair is likely to move sideways as it trades near its recent average, reflecting mixed signals from both economies. While the Singapore Dollar is temporarily at a 14-day high, it remains just below its 3-month average.
Key drivers:
- Rate gap: The Monetary Authority of Singapore has adopted a cautious approach to support economic growth, contrasting with the Swiss National Bank's potential easing due to high CHF strength.
- Risk/commodities: Ongoing geopolitical tensions maintain demand for the CHF as a safe haven, affecting trade and stability in the currency pair.
- Economic performance: Despite tariffs impacting exports, Singapore's GDP growth shows resilience, while Switzerland faces challenges from tariff impositions on Swiss goods.
Range:
Expect the SGD/CHF to hold within the recent 3.1% range, with fluctuations but no significant tests toward extremes anticipated.
What could change it:
- Upside risk: A stronger-than-expected economic performance from Singapore could bolster the SGD.
- Downside risk: Increased intervention from the SNB to curb CHF strength might pressure the SGD against the CHF.
