Dollar Rebounds on U.S.-EU Tariff Truce, but Swiss Franc Still Outshines the Euro
July 28, 2025CHF Reaction: Haven Bid Fades, Yet Franc Stays Firm vs. Euro
USD/CHF jumped 0.8 % to 0.8015, its sharpest one-day gain since late May, as traders unwound part of their safety positioning in the Swiss currency. Even so, EUR/CHF remains anchored near 0.93, preserving most of the franc’s 2025 appreciation against the single currency and leaving cross-border salaries converted into euros historically generous.
Euro Snaps Winning Streak
After an early pop in Asia, the euro slid 0.8 % to 1.164 USD, marking its largest daily reversal in six weeks. Investors reassessed whether easing tariff risks actually favour the dollar more - especially if U.S. corporate giants about to report earnings lure fresh capital back to Wall Street.
Yen Lags as BOJ Steadies Course
The dollar added 0.3 % against the yen at 148.12, while the franc briefly notched a record high versus JPY before retracing. With the Bank of Japan expected to keep rates unchanged this week, rate-differential logic still points to a soft yen - though traders will parse Governor Ueda’s remarks for hints of a slower tightening path.
Market Narrative: From “Divorce” to “Marriage Counselling”
Macquarie strategist Thierry Wizman quipped that Washington and its allies are moving from “divorce proceedings” to “marriage counselling,” a shift that helps the dollar by reviving faith in U.S. diplomacy. Yet longer-term projections from UBS Wealth still call for greenback weakness as lingering deficits and political noise erode its premium.
What CHF Earners Converting to Euros Should Watch
A stronger dollar often drags EUR lower versus CHF; if EUR/USD drops toward 1.15, EUR/CHF could slip below 0.925, boosting euro take-home pay from Swiss wages.
Fed and SNB divergence now matters less than tariff headlines; any revival of trade tension would likely re-ignite franc demand.
U.S. Big Tech earnings could attract flows back into dollar assets, tempering franc gains against USD but not necessarily against EUR.