CHF plunges across board as SNB returns to zero interest rates
The Swiss franc depreciated sharply against all major currencies after the SNB cut its key policy rate by 25 basis points to 0%, marking Switzerland's return to zero interest rates. EUR/CHF surged 0.6% to 0.9875, while GBP/CHF climbed 0.7% to 1.1520. The central bank cited below-target inflation projections and excessive franc strength as justification for the move. SNB officials indicated readiness to implement negative rates if needed, significantly altering the franc's appeal as a safe haven. Market positioning data showed heavy long CHF positions being unwound, accelerating the selloff. Technical analysis reveals EUR/CHF breaking above the 0.9850 resistance, targeting 0.9900-0.9950. The policy divergence between the SNB and other major central banks suggests continued CHF weakness, with traders eyeing carry trade opportunities in higher-yielding currencies against the franc.
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