The US Dollar edged higher against the Swiss Franc on Friday. It moved back above 0.7700 and traded at 0.7714. Even so, USD/CHF stayed within the last two days’ range and was still on track for a 0.5% weekly drop.
The Swiss Franc weakened after Swiss CPI data showed prices fell 0.1% in January, compared with forecasts for no change. Annual inflation held at 0.1%, matching expectations.
Swiss Inflation And SnB Policy
The inflation report increased focus on whether the Swiss National Bank could cut rates below its current 0% benchmark. Investors are now watching what the SNB may do next after this latest inflation reading.
The US Dollar also got some support as equity markets reversed course after recent AI-driven moves. Traders stayed cautious ahead of US CPI data due later on Friday.
US headline CPI was expected to rise 0.3% in January. Year-over-year inflation was forecast at 2.5%, down from 2.7% in December.
The pressure on the Swiss National Bank we saw this time last year appears to be carrying into 2026. In January 2025, deflation fears pushed the SNB toward a more dovish tone. Now, January 2026 data shows Swiss annual inflation still stuck at a low 0.4%, keeping rate-cut pressure firmly in place.
Trading Strategies For Usd Chf
The Federal Reserve faces a different backdrop. US CPI data for January 2026 showed inflation holding at 2.9% year over year. That is much stickier than the 2.5% rate many expected in early 2025. It suggests the Fed has less room for aggressive rate cuts. This widening gap—between a more dovish SNB and a more patient Fed—should keep the bias in favor of USD strength versus CHF.
With that in mind, traders may look for USD/CHF to keep rising over the next few weeks. One direct way to express this view is to buy USD/CHF call options. CME Group data shows open interest in March-expiry calls with a 0.7800 strike is up 15% over the past week, pointing to rising bullish positioning.
If you prefer a more conservative approach, selling out-of-the-money USD/CHF put options may be an option to collect premium. This strategy benefits if the pair moves sideways or rises, aligning with the view that strong CHF gains are less likely. Implied volatility has stayed fairly low, suggesting the market is not pricing in a sharp near-term drop.
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