The Swiss National Bank announced its interest rate decision on Thursday morning, following the September 25 meeting. The bank kept rates unchanged at 0.00%, the lowest level since June 2022, in line with market expectations. This marks a temporary pause in the monetary easing cycle, which had continued over the past six consecutive meetings.

• This statement is “positive” for the Swiss franc.

The Swiss franc rose in European trading on Thursday against a basket of global currencies, resuming gains against the U.S. dollar as the greenback’s rally paused ahead of key U.S. economic data releases.

The franc’s advance, however, remains limited, with investors refraining from building large positions ahead of the Swiss National Bank’s (SNB) policy decision, where rates are widely expected to remain unchanged.

Price Overview

USD/CHF today: the dollar slipped 0.1% to 0.7938 francs, down from the opening level of 0.7947, after touching a high of 0.7951.

The franc ended Wednesday down about 0.5% against the dollar, snapping a three-day winning streak, after cautious remarks from some Federal Reserve policymakers.

U.S. Dollar

The U.S. dollar index fell 0.1% on Thursday, retreating from a two-week high of 97.92, reflecting a pause in the dollar’s upward momentum against global currencies.

Beyond profit-taking and corrections, the dollar is easing ahead of key U.S. releases on Q2 GDP growth and weekly jobless claims. These data are expected to provide clearer signals on whether the Federal Reserve will continue cutting rates in the remainder of the year, particularly after the cautious tone expressed by Fed officials.

Swiss National Bank

The SNB concludes its regular policy meeting to assess economic conditions, with markets expecting no change in rates, which remain at 0.00%.

This decision would mark a pause in the monetary easing cycle that began in September 2023 and continued through the June meeting, coming against a backdrop of mounting inflationary pressures, especially from external factors.

The policy rate decision is due at 08:30 GMT, followed by remarks from the SNB Chairman and other officials at a press conference at 09:00 GMT.

Outlook for the Swiss Franc

Here at Economies.com, we expect the franc to continue rising against the U.S. dollar if the SNB delivers comments and projections that are more hawkish than markets currently anticipate.

The Japanese yen rose in Asian trading on Thursday against a basket of major and minor currencies, attempting to recover from a three-week low against the U.S. dollar. The move came on the back of bargain buying from lower levels, supported by a pause in the dollar’s rally ahead of key U.S. data releases.

Expectations for a Bank of Japan rate hike in October declined after less aggressive comments from Governor Kazuo Ueda, as markets await further evidence on the path of monetary policy normalization in the world’s fourth-largest economy.

Price Overview

USD/JPY today: the dollar fell by 0.15% to ¥148.56, down from the opening level of ¥148.89, after touching a high of ¥148.90.

The yen ended Wednesday down 0.85% against the dollar, snapping a three-day winning streak, and hitting a three-week low at ¥148.92 amid political uncertainty in Japan.

U.S. Dollar

The U.S. dollar index slipped 0.1% on Thursday, retreating from a two-week high of 97.92, reflecting a pause in the greenback’s rally against global currencies.

Beyond profit-taking and corrective moves, the dollar is easing ahead of key U.S. data on Q2 economic growth and weekly jobless claims. These figures are expected to provide clearer signals on whether the Federal Reserve will continue cutting rates through the remainder of the year, particularly after the cautious remarks from Fed officials regarding the policy outlook.

Japanese Interest Rates

Governor Kazuo Ueda said Friday that policymakers must closely monitor the impact of trade policies on financial markets, foreign exchange, the economy, and prices in Japan.

He added that the Bank of Japan will continue raising rates if the economy and inflation evolve in line with expectations, supported by improving conditions.

Following Ueda’s comments, market pricing for a 25-basis-point rate hike in October dropped from 75% to below 50%.

Investors now await further data on inflation, unemployment, and wages in Japan to reassess those odds.

Oil prices rose on Wednesday, hitting a seven-week high, after data showed an unexpected decline in U.S. crude inventories, contrary to market forecasts.

The Energy Information Administration reported that U.S. crude stockpiles fell by 0.6 million barrels to 414.8 million barrels last week, while expectations had pointed to an increase of about 0.8 million barrels.

Gasoline inventories dropped by 1.1 million barrels to 216.6 million barrels, while distillate stocks — which include heating oil and diesel — declined by 1.7 million barrels to 123.0 million barrels.

Separately, news agencies reported that Ukraine carried out attacks on oil facilities in Russia’s Volgograd region, while the city of Novorossiysk — home to key ports for oil and grain exports — declared a state of emergency due to the strikes.

At settlement, Brent crude futures for November delivery rose 2.5%, or $1.68, to $69.31 a barrel, the highest since early August. U.S. WTI crude futures for November delivery also gained 2.5%, or $1.58, to close at $64.99 a barrel, marking the highest close since September 2.