The Euro (EUR) is trading relatively flat against the Swiss Franc (CHF) on Thursday, with the EUR/CHF pair hovering around 0.9358 during the U.S. trading session. The pair continues to face strong technical resistance at the 100-day Simple Moving Average (SMA), currently near 0.9357, a level that has limited upward moves since early September.
🔍 Eurozone Labor Market Shows Signs of Cooling
Economic data from the Eurozone added pressure to the Euro, as the unemployment rate rose to 6.3% in August, slightly above expectations and higher than the 6.2% recorded in July and June. This marks the first uptick in several months, suggesting that the region’s labor market may be losing momentum amid slower economic growth.
Meanwhile, European Central Bank (ECB) policymaker Martins Kazaks stated on Thursday that economic uncertainty remains high. He emphasized that the current interest rate levels are “very appropriate” and could remain unchanged unless significant new risks emerge.
📉 Swiss Inflation Slows Again in September
In Switzerland, the latest inflation data came in weaker than expected:
- Monthly CPI fell by 0.2% in September (in line with forecasts).
- Annual inflation eased to 0.2%, missing the 0.3% estimate and staying flat compared to August.
- Core inflation slipped to 0.7% year-on-year.
A breakdown of the data showed lower prices for hotels, holiday packages, and air travel. On the other hand, modest price gains were seen in clothing, berries, and household furniture. The continued softness in both imported and domestic price pressures reinforces the view that inflation in Switzerland remains subdued.
🏦 Policy Outlook: SNB Holds Fire but Stays Cautious
With inflation so low, the Swiss National Bank (SNB) has limited room to tighten policy further. Market pricing suggests a 40% chance of a 25 basis-point rate cut to -0.25% within the next 12 months.
SNB President Martin Schlegel recently confirmed that the central bank remains ready to ease policy further if necessary. However, a resolution of Switzerland’s ongoing trade dispute with the U.S. could reduce the need for more aggressive action and help stabilize the Franc.
📊 Swiss Franc Performance Today
The Swiss Franc held firm on Thursday, showing mixed performance across major currencies. It was strongest against the British Pound and slightly weaker against the New Zealand Dollar.
Here’s a snapshot of CHF movements today:
| Base: CHF | USD | EUR | GBP | JPY | CAD | AUD | NZD |
|---|---|---|---|---|---|---|---|
| Change | +0.01% | -0.06% | +0.14% | +0.02% | +0.07% | +0.13% | -0.28% |
📈 Technical Picture: EUR/CHF Still Trapped Below 100-Day SMA
Technically, EUR/CHF remains stuck below its 100-day SMA, a key resistance level that has prevented further upside since early September. A break above this level could open the door to more gains, but until then, the pair is likely to remain range-bound.
🧭 Outlook
Both the Euro and Swiss Franc are being weighed down by weak inflation data and cautious central banks. For now, EUR/CHF may continue to trade sideways unless new economic catalysts or policy shifts emerge. Traders will be watching upcoming inflation and labor market data from both regions closely.