Swiss Franc Strengthens to Over 10-Year High

USDCHF decreased to a 10-year low of 0.81.

Over the past 4 weeks, US Dollar Swiss Franc lost 8.28%, and in the last 12 months, it decreased 11.16%.

The Swiss franc appreciated nearly 1% to around 0.816 per USD, holding close to 2011-highs, as the dollar weakened amid renewed U.S.-China trade tensions, stoking fears of a global recession.

Since the April 2 tariff announcement, the franc has surged over 7%, making it one of the top-performing major currencies.

The sharp appreciation and associated deflationary pressures may push the Swiss National Bank to consider reintroducing negative interest rates.

The Swiss franc rose toward 0.81 per USD, holding close to its highest level since August 2011, supported by safe-haven demand amid a subdued dollar, as investors sought refuge from persistent market uncertainty driven by President Trump’s shifting trade stance and unpredictable policy signals.

On Monday, Trump suggested he might temporarily exempt the auto industry from previously imposed tariffs, allowing carmakers more time to adjust their supply chains.

He also announced temporary exemptions for key tech products—including semiconductors and smartphones—from the latest round of tariffs on Chinese imports.

Despite these measures, uncertainty around U.S. trade policy continues to weigh on global markets.

The Swiss franc edged slightly lower toward 0.82 per USD but remained near its strongest levels since 2011, as investor uncertainty persisted amid the unpredictability of U.S. trade and economic policy.

Some relief came after President Donald Trump announced temporary exemptions on key tech products — including semiconductors and smartphones — from the latest round of tariffs on Chinese imports.

However, the U.S. administration later clarified that these items remain subject to existing 20% fentanyl-related tariffs, and a new special tariff targeting semiconductors and electronics is set to take effect in about a month.

With the Swiss franc holding firm, economists are increasingly focused on potential measures from the Swiss National Bank (SNB), including the possibility of a rate cut in June if the franc doesn’t soften from its current level.

Societe Generale in its early Friday economic news summary pointed out:

— US dollar exodus accelerates on United States Treasury sell-off, trades 1.1383 high after clearing 1.1275 Fibo resistance. slides to 0.8141. 30-year UST yield +50bps this week at 4.90%, biggest rise since 1982. Strong 30-year auction on Thursday stop through 2.7bpa, non-dealer bidding 87.7%, indirects 61.9%. Gold scales $3,200/oz. JPM, MS & Wells Fargo report 1Q earnings on Friday.

— Foreign exchange intervention next? asks SocGen. The Swiss central bank (SNB) has no comment about the Swiss franc (CHF). European Central Bank staff forecast assumes 1.04 for 2025-2027, Treasury Secretary Bessent shrugs off yen (JPY) strength ahead of planned trade talks.

— United Kingdom February gross domestic product 0.5% month over month (+0.6% three-month/three-month), above forecast. Services +0.3%, manufacturing +2.2%, construction +0.4%.

— Day ahead: ECB speaker Lagarde. U.S. producer price index, SocGen forecast -0.1% month over month, core +0.3% month over month. Preliminary University of Michigan sentiment. Federal Reserve speakers Musalem and Williams. Brazil's consumer price index.

— Nikkei -2.7%, EUR 10-year IRS +1.5bps at 2.565%, Brent crude +1.1% at $64.0/barrel, Gold +1.4% at $3,202/oz.

There seems little reason to expect a recovery in the dollar any time soon as the U.S. currency slides to a three-year low against a basket of currencies and hits a decade low against the safe-haven Swiss franc, MUFG analyst Derek Halpenny says in a note. "U.S. dollar and U.S. Treasury bond selling adds to investor uncertainties," he says. "In this environment it is hard to see any near-term revival in U.S. dollar confidence." Fears that China or other countries could lighten their holdings of U.S. Treasurys could exacerbate the moves, he says. The DXY dollar index falls 1.7% to a low of 99.014, while the euro rises 2.1% to a three-year high of $1.1476. Against the Swiss franc, the dollar falls to a low of 0.8113 francs, FactSet data show. (jessica.fleetham@wsj.com)