Trade Truce Lifts Markets, Swiss Franc Steadies Near Highs

Immediate Market Reaction: Dollar Up, Franc Firm

News of the détente sent U.S. equity futures and the dollar modestly higher, yet the Swiss franc held its ground: USD/CHF hovered near CHF 0.83, reflecting investors’ caution that the truce is temporary. EUR/CHF remained stable around 0.934 as safe-haven flows into the franc persisted despite broader risk-asset relief.

Why the Franc Remains a Barometer

Safe-haven status: Even as tariffs ease, lingering uncertainty keeps demand for CHF intact. SNB vigilance: With Swiss inflation at 0 %, markets still price another rate cut on 19 June—potentially back into negative territory—adding complexity to franc dynamics. Export pressure: A resilient franc cushions consumer prices but weighs on Swiss manufacturers; any renewed strengthening could spur SNB FX intervention.

Winners and Losers Beyond FX

European stocks sensitive to trade—Maersk +12 %, LVMH +7.4 %, Kering +6.7 %—rallied on hopes of revived U.S.–China flows. Conversely, safe-haven yen slipped as risk appetite improved, while commodity currencies AUD and NZD extended gains on expectations of stronger Asian demand.

What’s in (and out of) the Deal

No sector-specific tariffs removed—strategic rebalancing in semiconductors, medicines and steel remains U.S. policy. Rare-earth curbs stay: Beijing’s export controls unchanged, maintaining supply-chain risk. Fentanyl talks separate track: U.S. officials called discussions “constructive,” but no concrete measures yet.

Outlook: Temporary Reprieve or Turning Point?

Treasury Secretary Scott Bessent signalled both sides “do not want a decoupling,” yet analysts warn the 90-day window may simply postpone deeper disagreements. Barclays notes peak tariffs may be behind us “locally,” but structural issues—IP protection, state subsidies—remain unresolved.

Swiss Franc Watchlist

It’s worth tracking three key currency pairs. For USD/CHF, critical support sits near 0.81 and resistance around 0.84; the main catalysts are the June SNB meeting and signals from the Federal Reserve. EUR/CHF is hovering between 0.92 and 0.945, driven by euro-area data and any potential SNB intervention. Meanwhile, CHF/JPY may oscillate in the 156–161.5 range, responding to Bank of Japan decisions and broader shifts in risk appetite.