The Swiss National Bank announced that total sight deposits for the week ending August 29 reached CHF 472.3 billion. This is an increase from CHF 469.5 billion the previous week. Domestic sight deposits rose to CHF 444.7 billion, up from CHF 442.5 billion the week before.

Swiss Sight Deposits Update

Swiss sight deposits are now at their highest level since the last week of July. This increase has continued after a decision made in June. The growth in sight deposits shows that the Swiss National Bank is actively engaging in the currency market. They are selling francs to purchase foreign currencies to stop the franc from rising too much. This indicates an ongoing effort to control the currency’s value since their policy meeting in June 2025. This intervention could establish support levels for currency pairs like EUR/CHF and USD/CHF. For traders in derivatives, this means the risk of these pairs dropping significantly may be reduced due to central bank activity. As a result, strategies that benefit from a stable or weaker franc may become more attractive.

Trading Strategy Considerations

Earlier this month, EUR/CHF fell to about 0.9550 before rising again. The central bank’s moves seem intended to protect those levels. With the latest Swiss inflation rate for August 2025 at a mild 1.3%, the SNB aims to prevent a stronger franc that could lower inflation further. This pattern has been consistent since the major rate cuts initiated in 2024. Given this situation, selling out-of-the-money put options on EUR/CHF could be a good strategy for the upcoming weeks. The premium earned provides income, while the SNB’s actions offer protection against a significant drop. Targeting expirations after the SNB policy meeting on September 18, 2025, may help capture any related market movement. Although the SNB’s influence may reduce realized volatility, implied volatility could still be high due to the risk of unexpected policy changes. This creates opportunities for traders who believe the SNB can keep the franc stable. The main risk is a sudden shift in the bank’s policy, a lesson learned from the events of January 2015. Create your live VT Markets account and start trading now.

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