The Swiss franc strengthened to 0.79 per US dollar, rebounding from a two-month low as the greenback weakened following news of a provisional peace accord between the United States and Iran. The deal, which reportedly includes lifting the US blockade and reopening the Strait of Hormuz, is expected to be signed in Switzerland on Friday.
Nonetheless, investor caution remains elevated as markets await further clarity, particularly on the unresolved status of Iran’s nuclear program. Meanwhile, oil prices dropped sharply, easing inflationary pressures and tempering expectations of additional interest rate hikes. Money market pricing currently suggests the Swiss National Bank will leave interest rates unchanged for the rest of the year.
On the domestic data front, Swiss producer and import prices fell by 0.4% in May, defying consensus estimates for a 0.4% increase. Consumer sentiment improved modestly, broadly in line with market forecasts.
