Eurchf To Jump Higher Socgen

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Eurchf To Jump Higher Socgen

Eur/Chf To Jump Higher - Socgen

According to the SocGen analysts, the SNB is highly likely to turn negative again. They have also issued a forecast for the EUR/CHF with a price target of 0.98.

According to SocGen, the EUR/CHF pair is expected to rise towards 0.98 by Q1 2026. For now, the pair is exchanging hands near the 0.93 handle.

Eur/Chf To Rise Towards 0.98

This means SocGen analysts are forecasting a rise of almost 500-600 pips in the EUR/CHF pair. The reason for this bullish trend in the EUR/CHF would be the negative tone of the SNB.

The Swiss Central Bank is expected to start using negative interest rates once again. SocGen added that it will happen during the rest of 2025. A natural response to that will be the weakening of the CHF.

Meanwhile, the Swiss consumer prices remain little changed during April. Also, the annual exchange rate has declined from 0.3% to 0.0%.

For the SNB, one of the most important factors is the inflation rate. At the same time, the central bank is also trying to balance the deflation risks.

Also, the SNB is struggling to balance the uncertainty brought by the trade tariffs. However, the deflation risks remain a key theme for Switzerland.

In March 2025, the SNB lowered the rates by 0.25% and that's just the start. For a period of 10 years, the SNB maintained negative rates in the country to stop the Franc from strengthening.

Now, the SNB is highly likely to resort to its old tactics once again to stop the CHF from gaining strength. In theory, a weaker currency will help Switzerland to make its exports more lucrative.

According to SocGen, the SNB will also intervene in the currency markets to keep the CHF in check. So, that's also a risk that must be considered when looking at EUR/CHF.

There is a good chance that the Swiss government will strike a deal with the USA. However, the use of negative rates could make things difficult and would make the US administration angry again.

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