Fundamental News - USD/CHF

The Swiss franc notched a 12-month low of 0.946 per USD, pressured by a strong dollar after large inflation figures strengthened market expectations of a 50bps rate hike by the Fed and the start of its balance sheet run-off process. Meanwhile, sight deposits at the SNB rose by CHF 2.2 billion in the week ending April 8th from the previous week, following the CHF 5.7 billion jump from the prior week. The deposit increases are widely seen as a proxy for the central bank’s foreign currency interventions, dictating the amount of credit added on sight accounts of commercial banks with freshly created francs in exchange for foreign currency. In its last meeting, the SNB emphasized it would limit the franc’s appreciation, which is not far from the 7-year high against the euro touched after Russia’s invasion of Ukraine.