Geopolitical tensions following US-Israeli strikes on Iran sent a massive wave of safe-haven inflows into the Swiss franc, pushing the currency toward 11-year highs against the euro. In response, the Swiss National Bank (SNB) moved to sell francs directly in foreign exchange markets.
The intervention, confirmed by Chairman Martin Schlegel, signals an increased readiness to act. With the bank’s policy rate frozen at the zero lower bound, foreign exchange sales remain its only viable monetary tool. The SNB’s primary objective is to buffer Switzerland’s export-driven economy-specifically its manufacturing, pharmaceutical, and precision instrument sectors-from severe margin compression caused by currency appreciation.
The move effectively creates a soft ceiling for the franc, forcing forex traders long on CHF as a geopolitical hedge to reconsider central bank pushback. The SNB maintains that price stability and export competitiveness override experimental strategies, a stance reinforced by a failed 2026 petition to add Bitcoin to official reserves.