Euro holds steady against Swiss Franc as oil prices stay lower and German manufacturing maintains momentum

Lower oil prices following the US midterm election results ease energy pressures, potentially supporting gains in the Euro.
A recovery in German factory orders, alongside hawkish ECB remarks on rate increases, supports the outlook for the EUR.
An unexpected rise in inflation supports the Swiss Franc, potentially limiting gains in EUR/CHF.

At around 0.9170 in Thursday's European session, EUR/CHF is little changed after recouping its earlier losses. Falling crude oil prices are supporting the Euro (EUR), which could give the cross scope to advance. The decline in oil followed a Democratic sweep in the US midterm elections, fuelling expectations of greater pressure on the Trump administration to bring the conflict with Iran to an end. While indicating that there were no immediate plans to intensify military strikes, President Donald Trump acknowledged that the war and higher petrol prices were largely responsible for Republican election losses.

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Germany’s Factory Orders increased by 3.3% year-on-year in September, compared with a revised rise of 3.2% in the preceding month. Monthly orders for German-manufactured goods recovered by 4.4% after August’s sharp 10.1% contraction, although the rebound was weaker than the 4.8% growth forecast. These figures suggest renewed momentum in the region’s largest economy and may lend further support to the Euro.

Hawkish remarks from European Central Bank (ECB) officials also supported the Euro. Officials suggested that further interest rate increases may be necessary to curb inflation and avert a wage-price spiral.

An unexpected acceleration in Swiss inflation to 1.5% year-on-year in October, however, is supporting the Swiss Franc (CHF), leaving EUR/CHF exposed to downside risks. The inflation reading raises questions over whether the Swiss National Bank (SNB) can refrain from tightening monetary policy through 2027.

Franc draws renewed interest as hawkish SNB shift weighs on EUR/CHF

For ING analysts, a more hawkish stance at the SNB is “quite a clean positive for the Swiss franc,” with the bank noting that “traders will remember 2023, when the SNB actively drove the franc stronger and sold FX as part of its tightening toolkit.” In this context, the analysts “expect to see even more interest in the Swiss franc over the coming months, with downside risks to EUR/CHF forecasts.”

Euro Performs Best Against Sterling Today

The Euro (EUR) recorded its strongest performance against the British Pound today. Its percentage moves against the major currencies listed are set out in the table below.

	USD	EUR	GBP	JPY	CAD	AUD	NZD	CHF
USD		-0.10%	0.00%	-0.13%	-0.07%	-0.06%	-0.29%	-0.11%
EUR	0.10%		0.11%	-0.05%	0.03%	0.03%	-0.18%	-0.02%
GBP	-0.01%	-0.11%		-0.17%	-0.08%	-0.07%	-0.29%	-0.12%
JPY	0.13%	0.05%	0.17%		0.06%	0.07%	-0.18%	0.01%
CAD	0.07%	-0.03%	0.08%	-0.06%		0.01%	-0.22%	-0.05%
AUD	0.06%	-0.03%	0.07%	-0.07%	-0.01%		-0.21%	-0.05%
NZD	0.29%	0.18%	0.29%	0.18%	0.22%	0.21%		0.20%
CHF	0.11%	0.02%	0.12%	-0.01%	0.05%	0.05%	-0.20%

Percentage movements between the major currencies are displayed in the heat map. Select the base currency in the left-hand column and the quote currency in the top row. To read EUR (base)/USD (quote), for instance, choose the Euro on the left and follow its row across to the US Dollar; the intersecting cell gives the percentage change.