Switzerland’s trade balance rose to 3,818m in January, up from 1,036m in the previous period.
The latest reading shows a larger surplus in January than in the prior period.
Switzerland’s sharp rise in the January trade surplus points to strong exports and comes in well above expectations. This suggests the Swiss Franc (CHF) could strengthen in the near term. We should consider positioning for CHF gains versus both the Euro and the US Dollar.
In derivatives, one way to express this view is to buy CHF call options. In practice, that often means buying put options on EUR/CHF and USD/CHF. Recent market data shows EUR/CHF can react strongly to economic surprises, and this release could pull it back toward the lows seen in late 2025. Another approach is to sell out-of-the-money put spreads on these pairs to collect premium.
This data also affects the Swiss National Bank’s (SNB) policy outlook. Any remaining expectations for a first-half rate cut may fade. The SNB held rates steady through much of 2025, and this report gives it even more reason to stay firm—typically supportive for the franc.
The export strength is likely focused in key industries such as pharmaceuticals and luxury watches, which are major parts of the Swiss Market Index (SMI). Q4 2025 earnings already showed these sectors holding up well, and the trade data now supports that view with official statistics. We should consider buying call options on the SMI, or on specific export-driven companies in the index.
This view is also supported by last week’s manufacturing PMI, which surprised to the upside at 52.3. That pushes into expansion for the first time since summer 2025. It suggests the trade surplus is not a one-off, but part of a broader industrial improvement. This fits with continued global demand for high-value Swiss goods.
We should still watch comments from the European Central Bank. A more dovish ECB could push EUR/CHF lower faster, but it could also raise volatility around the next meeting. The main risk to a bullish CHF view is a sudden global slowdown, which would reduce demand for Swiss exports.
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