The Swiss franc hovered around 0.78 per USD, holding near historic highs as investors weighed heightened safe-haven demand amid escalating tensions in the Middle East against the risk of Swiss National Bank (SNB) intervention and subdued domestic inflation. The conflict intensified after Israel struck Beirut on Friday, following an unprecedented evacuation of the Lebanese capital’s southern suburbs, in what marked a major expansion of its war with Iran, launched a week earlier in coordination with the United States. Meanwhile, Donald Trump stated that Washington should play a role in choosing Iran’s next supreme leader following reports of Ali Khamenei’s death.
At the same time, SNB Vice President Antoine Martin reiterated that the central bank stands ready to intervene to contain excessive appreciation of the franc, citing the complex geopolitical environment. Earlier in the week, data showed that Swiss inflation remained at 0.1% in February, slightly above expectations for a 0.1% decline yet still at the lower bound of the SNB’s 0–2% target range.
