EUR/CHF dips after mixed Eurozone CPI; focus turns to Swiss inflation figures
Oleh Vishal Chaturvedi
Tarikh Diterbitkan: 2 Dec 2025 | Tarikh Diubah: 2 Dec 2025
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The Euro (EUR) edges lower against the Swiss Franc (CHF) on Tuesday, with EUR/CHF trading around 0.9333, easing slightly from the upper end of its multi-day range after trading flat for most of the day as traders show a muted reaction to preliminary Eurozone inflation data.
- EUR/CHF edges lower as traders show muted reaction to preliminary Eurozone inflation data.
- Eurozone HICP rose 2.2% YoY in November, while Core HICP held at 2.4% YoY.
- Traders turn cautious ahead of Switzerland’s CPI release, with SNB seen holding rates at 0% next week.
The Euro (EUR) edges lower against the Swiss Franc (CHF) on Tuesday, with EUR/CHF trading around 0.9333, easing slightly from the upper end of its multi-day range after trading flat for most of the day as traders show a muted reaction to preliminary Eurozone inflation data.
The latest Eurozone figures showed a mixed but steady inflation picture for November. Preliminary Harmonized Index of Consumer Prices rose 2.2% YoY, slightly above the 2.1% consensus and matching October’s pace. Core HICP increased 2.4% YoY, coming in just below the 2.5% forecast and unchanged from October.
On a monthly basis, Core HICP fell 0.5% in November, reversing the 0.3% increase recorded in October. Headline HICP declined 0.3% in November, compared with a 0.2% rise in October.
The inflation data supported the case for the European Central Bank (ECB) to maintain its current stance, reinforcing market expectations that interest rates will remain unchanged while inflation holds slightly above the ECB’s 2% medium-term target. With policymakers signalling little urgency to adjust policy further, attention now turns to the ECB’s next monetary policy decision, scheduled for December 18.
Further backing this view, ECB Governing Council member Joachim Nagel said on Tuesday in an interview with German magazine Stern that the Eurozone had “practically achieved” its inflation goal and that the inflation rate would continue to fluctuate around this level in the near future.
EUR/CHF’s subdued momentum also reflected trader caution ahead of Switzerland’s inflation data due on Wednesday. Economists expect the Swiss Consumer Price Index to fall 0.1% MoM in November after a 0.3% decline in October, while the annual CPI rate is projected to hold steady at 0.1%.
The upcoming release is likely to shape expectations around the Swiss National Bank’s outlook ahead of its interest rate decision on December 11. Analysts widely expect the central bank to keep rates unchanged at 0%.
Recent comments from SNB Chairman Martin Schlegel underscored that the bar for returning to negative interest rates remains “high,” although he emphasized that the SNB is prepared to cut rates if necessary. SNB Board Member Petra Tschudin also noted that inflation is likely to rise slightly in the coming quarters.
SNB FAQs
The Swiss National Bank (SNB) is the country’s central bank. As an independent central bank, its mandate is to ensure price stability in the medium and long term. To ensure price stability, the SNB aims to maintain appropriate monetary conditions, which are determined by the interest rate level and exchange rates. For the SNB, price stability means a rise in the Swiss Consumer Price Index (CPI) of less than 2% per year.
The Swiss National Bank (SNB) Governing Board decides the appropriate level of its policy rate according to its price stability objective. When inflation is above target or forecasted to be above target in the foreseeable future, the bank will attempt to tame excessive 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.
Yes. The Swiss National Bank (SNB) has regularly intervened in the foreign exchange market in order to avoid the Swiss Franc (CHF) appreciating too much against other currencies. A strong CHF hurts the competitiveness of the country’s powerful export sector. Between 2011 and 2015, the SNB implemented a peg to the Euro to limit the CHF advance against it. The bank intervenes in the market using its hefty foreign exchange reserves, usually by buying foreign currencies such as the US Dollar or the Euro. During episodes of high inflation, particularly due to energy, the SNB refrains from intervening markets as a strong CHF makes energy imports cheaper, cushioning the price shock for Swiss households and businesses.
The SNB meets once a quarter – in March, June, September and December – to conduct its monetary policy assessment. Each of these assessments results in a monetary policy decision and the publication of a medium-term inflation forecast.
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