USD/CHF depreciates to near 0.7650 ahead of Nonfarm Payrolls
- USD/CHF falls as the US Dollar weakens before Wednesday’s delayed US jobs report, signaling rate outlook clues.
- Markets expect Nonfarm Payrolls to show 70,000 job gains, with the Unemployment Rate steady at 4.4% in January.
- The Swiss Franc gains on safe-haven demand amid persistent concerns over artificial intelligence.
USD/CHF depreciates after registering modest gains in the previous session, trading around 0.7660 during the Asian hours on Wednesday. The pair weakens as the US Dollar (USD) extends its decline, with investors remaining cautious ahead of the delayed US employment report due Wednesday, which is expected to provide fresh clues on the US interest rate outlook.
Markets forecast that January Nonfarm Payrolls (NFP), due on Wednesday, are expected to show an increase of 70,000 jobs, while the Unemployment Rate is projected to hold steady at 4.4%. Data released Tuesday by the US Census Bureau showed that Retail Sales were unchanged at $735 billion in December, following a 0.6% rise in November and falling short of expectations for a 0.4% increase. On a YoY basis, Retail Sales grew 2.4%, while total sales for October–December 2025 advanced 3.0% (±0.4%) compared with the same period a year earlier.
The unexpected stagnation in US Retail Sales suggests rising strain on lower- and middle-income households. Investors widely expect the Federal Reserve (Fed) to keep interest rates unchanged in March, with the first rate cut anticipated in June and a potential second reduction in September.
Meanwhile, the USD/CHF pair could face additional downside pressure as the Swiss Franc (CHF) benefits from safe-haven demand. Investor sentiment has been weighed down by ongoing concerns surrounding artificial intelligence and reports that Chinese regulators have advised financial institutions to curb exposure to US Treasuries amid policy uncertainty, a cautious approach reportedly mirrored by other major economies.
Market participants are also looking ahead to Switzerland’s January inflation figures, scheduled for release on Friday. Analysts expect annual inflation to remain subdued at 0.1%. Swiss National Bank (SNB) Chairman Martin Schlegel recently emphasized the challenges of persistently low inflation and a policy rate at 0%, reaffirming the central bank’s commitment to maintaining price stability within its 0–2% target range.
Swiss Franc FAQs
The Swiss Franc (CHF) is Switzerland’s official currency. It is among the top ten most traded currencies globally, reaching volumes that well exceed the size of the Swiss economy. Its value is determined by the broad market sentiment, the country’s economic health or action taken by the Swiss National Bank (SNB), among other factors. Between 2011 and 2015, the Swiss Franc was pegged to the Euro (EUR). The peg was abruptly removed, resulting in a more than 20% increase in the Franc’s value, causing a turmoil in markets. Even though the peg isn’t in force anymore, CHF fortunes tend to be highly correlated with the Euro ones due to the high dependency of the Swiss economy on the neighboring Eurozone.
The Swiss Franc (CHF) is considered a safe-haven asset, or a currency that investors tend to buy in times of market stress. This is due to the perceived status of Switzerland in the world: a stable economy, a strong export sector, big central bank reserves or a longstanding political stance towards neutrality in global conflicts make the country’s currency a good choice for investors fleeing from risks. Turbulent times are likely to strengthen CHF value against other currencies that are seen as more risky to invest in.
The Swiss National Bank (SNB) meets four times a year – once every quarter, less than other major central banks – to decide on monetary policy. The bank aims for an annual inflation rate of less than 2%. When inflation is above target or forecasted to be above target in the foreseeable future, the bank will attempt to tame price growth by raising its policy rate. Higher interest rates are generally positive for the Swiss Franc (CHF) as they lead to higher yields, making the country a more attractive place for investors. On the contrary, lower interest rates tend to weaken CHF.
Macroeconomic data releases in Switzerland are key to assessing the state of the economy and can impact the Swiss Franc’s (CHF) valuation. The Swiss economy is broadly stable, but any sudden change in economic growth, inflation, current account or the central bank’s currency reserves have the potential to trigger moves in CHF. Generally, high economic growth, low unemployment and high confidence are good for CHF. Conversely, if economic data points to weakening momentum, CHF is likely to depreciate.
As a small and open economy, Switzerland is heavily dependent on the health of the neighboring Eurozone economies. The broader European Union is Switzerland’s main economic partner and a key political ally, so macroeconomic and monetary policy stability in the Eurozone is essential for Switzerland and, thus, for the Swiss Franc (CHF). With such dependency, some models suggest that the correlation between the fortunes of the Euro (EUR) and the CHF is more than 90%, or close to perfect.
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