Swiss National Bank may cut interest rates in the upcoming meeting.

The Swiss franc has been strengthening continuously, approaching a three-month high. This appreciation is driven by increased demand for safe-haven assets amid rising concerns about the global economy and geopolitical tensions. At the same time, uncertainty surrounding President Trump’s tax policies has caused confusion across various sectors, particularly among businesses and investors. This uncertainty has led to fears that inflation may intensify.Regarding Switzerland’s economic data, rapidly declining inflation has increased the likelihood that the Swiss National Bank (SNB) will further cut interest rates in its upcoming meeting on March 20. Investors anticipate a 25 bps rate cut.

Switzerland’s GDP growth slowed to 0.2% in Q4 2024 from 0.4% in Q3, in line with market expectations. This marks the weakest expansion since 2023, with several sectors experiencing slower growth, including construction, automotive parts, and healthcare. Meanwhile, the manufacturing sector saw a slight recovery after slowing in the previous quarter. Household consumption and government spending continued to grow steadily, while the rising trade surplus also contributed positively to GDP. Exports increased by 7%, while imports rose by only 2.8%.

Switzerland’s economic indicators declined to 101.7 in February, with most manufacturing-related indicators remaining under pressure. Additionally, overall business sentiment continues to decline due to reduced production capacity and lower profits. Some industries remain at risk of facing an economic downturn, particularly the paper and printing sector. Overall, the economy remains under pressure due to weak external demand and slowing personal consumption.

Switzerland’s inflation rate slightly declined to 0.3% year-on-year in February, down from 0.4% in January. This was due to a slower increase in energy prices, while food and beverage inflation continued to decline at 0.6%. Moreover, inflation in the real estate sector, including rental prices, continued to trend downward, pressured by weaker household purchases of big-ticket items. Meanwhile, core inflation—which excludes volatile food and energy prices—remained steady at 0.9%, the same as in January. Investors still expect the Swiss National Bank to cut interest rates further to stimulate the slowing economy and counter the ongoing decline in inflation.

Switzerland’s unemployment rate dropped to 2.9% from 3.0% in the previous month, marking the highest unemployment level since 2021. The number of unemployed people fell by 300, bringing the total to around 130,000. Meanwhile, youth unemployment (measured among job seekers aged 15-24) fell to 2.7%, marking the second consecutive monthly decline after decreasing to 2.8% in January. The number of unemployed youths declined by 300, bringing the total to 12,000. Additionally, job vacancies increased by more than 2,300 positions, indicating a slight rise in labor demand.

Techical analysis data (5H)

Resistance: 0.8812, 0.8829, 0.8839

Source: Investing.com

Buy/Long 1: If the price touches support in the price range of 0.8775 - 0.8785 but cannot break the support at 0.8785, you may set a TP at approximately 0.8829 and SL at around 0.8758 or according to your acceptable risk.

Buy/Long 2: If the price breaks the resistance in the price range of 0.8812 - 0.8829, you may set a TP at approximately 0.8839 and SL at around 0.8775 or according to your acceptable risk.

Sell/Short 1: If the price touches resistance in the price range of 0.8812 - 0.8829 but cannot break the resistance at 0.8812, you may set a TP at approximately 0.8775 and SL at around 0.8839 or according to your acceptable risk.

Sell/Short 2: If the price breaks the support in the price range of 0.8775 - 0.8785, you may set a TP at approximately 0.8758 and SL at around 0.8829 or according to your acceptable risk.

Pivot point March 18, 2025 08:25 PM. GMT+7