Swiss Franc Falls as US Tariffs Overshadow Inflation Uptick
The Swiss franc weakened to around 0.81 per US dollar as concerns over newly announced US tariffs overshadowed a modest uptick in Swiss inflation.
On August 1, the Trump administration unveiled a 39% tariff on Swiss exports—higher than the 31% rate announced in April—with the measures set to take effect on August 7. If sustained, the tariffs are expected to reinforce disinflationary pressures in Switzerland.
Meanwhile, inflation rose slightly to 0.2% year-on-year in July, above expectations of 0.1% but still hovering near zero. The subdued price growth, combined with mounting external risks, suggests the Swiss National Bank may still move to lower interest rates further into negative territory.
Adding to concerns, the Swiss manufacturing PMI fell to 48.8 in July from 49.6 in June, signaling a deeper contraction in the sector.
Source: Trading Economics