Swiss Franc Trend Analysis: New Opportunities for Safe-Haven Currency in 2025

Why Is the Swiss Franc’s Hedging Status Steady?

As a historically neutral country, Switzerland’s currency, the Swiss Franc (CHF), has long been regarded by the market as an important safe-haven asset. Whenever global financial turmoil occurs—be it the 2007 financial crisis, the 2011 European sovereign debt crisis, or today’s rising trade tensions—funds tend to flow into such low-risk assets.

So, in the current environment, does the Swiss Franc still hold investment appeal? The answer is yes, but its trend is no longer as straightforward as in the past.

Multiple Factors Driving the Swiss Franc’s Movement

The Key Role of Central Bank Policies

The actions of the Swiss National Bank (SNB) directly influence the exchange rate. In the past two years, the SNB has shifted from tightening to easing policies. In June 2025, the Swiss central bank lowered its policy rate to 0%, marking the first time since the end of the negative interest rate era in late 2022 that it reached zero.

The underlying logic of this move is twofold: on one hand, to ease the ongoing appreciation pressure on exports; on the other, to respond to expectations of a global economic slowdown. Notably, the Swiss central bank has historically intervened less actively in the forex market, but in an environment of sharp risk appetite changes, markets have begun to closely monitor SNB’s policy signals.

Cyclical Fluctuations in Safe-Haven Demand

Like gold, the Swiss Franc often performs remarkably well during periods of market panic. Switzerland holds 1,040 tons of gold reserves, ranking among the top globally on a per capita basis, which in some ways reflects the currency’s “solid foundation.”

However, gold and the Swiss Franc do not always move in perfect sync. During relatively stable periods, the Franc tends to follow non-USD currency fluctuations, while gold has its own independent logic. But when markets are shrouded in heightened risk aversion, both the Franc and gold become safe-haven assets attracting capital.

Global Economic Outlook and Geopolitical Landscape

The performance of the Swiss Franc in 2025 cannot avoid the impact of the Trump administration’s tariff policies. Due to increased global trade uncertainty triggered by tariff battles, capital has sought safe havens, making the Franc a direct beneficiary—appreciating over 10% since the beginning of the year.

Meanwhile, the IMF forecasts global GDP growth of only 2.8% in 2025, with economic slowdown further strengthening investors’ preference for low-risk assets.

Additionally, European geopolitical developments significantly influence the Franc. If Europe stabilizes, the Franc’s safe-haven appeal may be limited; but if major turbulence occurs, capital will accelerate flowing into the Franc, especially relative to other European currencies.

Interpreting the Swiss Franc’s Trends

Signal of USD/CHF Turning Point

The USD/CHF exchange rate has fallen from 0.9078 at the start of the year to around 0.8, a decline of over 10%. This shift mainly occurred after Trump announced the “reciprocal tariffs” policy in April. Market forecasts suggest the rate may continue to decline, reflecting a generally bearish outlook on the USD/CHF.

In short, the downward trend of USD/CHF indicates the Swiss Franc is strengthening against the dollar, with safe-haven capital steadily flowing in.

Range-bound Movement of EUR/CHF

EUR/CHF performance is more complex. In Q1 2025, influenced by rising European inflation expectations and delayed ECB rate cuts, the pair rose to a high of 0.9676 for the year. But in Q2, as the Eurozone economy weakened and global trade tensions escalated, safe-haven demand for the Franc increased, causing the pair to sharply retreat to around 0.94.

Future trends depend on three variables: if the ECB slows rate cuts or European economic data surpass expectations, EUR/CHF could rise again; conversely, if safe-haven demand for the Franc intensifies or global risks escalate, the pair could fall below 0.90.

How Can Ordinary Investors Participate?

There are multiple ways to invest in the Swiss Franc:

Bank Trading is the most traditional method, but it faces disadvantages such as high spreads and low trading efficiency, making it suitable mainly for ultra-long-term investors.

Futures Trading suits advanced investors. The world’s largest commodity futures exchange (CME) offers Swiss Franc futures instruments, supporting high leverage, nearly 24/7 trading, and two-way operations. However, futures involve rollover costs, and most cross-currency pairs require multi-currency combinations to execute.

CFD Trading has become the most popular choice among retail traders over the past decade. Compared to futures, CFDs require lower margin, can be held indefinitely without rollover, and offer greater convenience for modern trading. Whether it’s main pairs (USD/CHF, EUR/CHF) or other crosses, investors can choose freely.

Comparison of the three methods: CFDs offer the most flexible trading hours, smallest spreads, and easiest position management; futures provide maximum leverage and more transparent costs; bank trading is the most traditional but also the most costly.

Core Logic of Investment Decisions

Short-term fluctuations of the Swiss Franc are driven by differences in central bank policies and local economic data, but its long-term core value stems from its “safe-haven” attribute—that is, serving as a hedge tool to help investors weather turbulence.

If you are cautiously optimistic about the macro environment over the next few years, the Swiss Franc should be a key component of your portfolio. Given the current global slowdown, rising geopolitical risks, and clear divergence in central bank policies, the Franc is expected to maintain its role as an important risk hedge in the coming years.

Speculative traders should focus on the overlapping trading windows of the European and US sessions (from 9 PM to 2 AM Beijing time, with winter time adjustments), as this is when market liquidity is strongest and volatility most active.