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EURCHF Currency Pair

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Overview | EURCHF Chart | Key Facts

The EURCHF Currency Pair

The cross currency pairing of the euro (EUR) to the Swiss franc (CHF) is popular among international forex market participants. A “cross currency pairing,” or “cross pair,” is a foreign currency exchange that takes place without first converting the base currency into United States dollars (USD). According to the International Bank of Settlements, EUR/CHF is the third-most frequently traded cross pair on the forex, showing an average daily volume valued at US$44 billion. In total, it’s the 25th most commonly traded pair on the forex, comprising .9% of aggregate daily volume.1)Retrieved 26 October 2016 http://www.bis.org/publ/rpfx16fx.pdf

Active trade of EUR/CHF affords market participants a few distinct advantages:

Sometimes labelled a “safe haven” currency, the Swiss franc has often been a destination for investors seeking to mitigate global economic risk. Evidence of the currency acting as a safe haven occurred in the years following the 2008 global debt crisis. From January 2009 to January 2011, the exchange rate of EUR/CHF fell from a high of 1.5447 to a low of 1.2400. This move represented nearly a 20% depreciation of euros to francs, mostly because of the widespread buying of francs in response to global economic uncertainty.

In September 2011, the Swiss National Bank (SNB) elected to peg the CHF’s exchange rate to the euro, implementing a “cap” of 1.20 CHF to the euro. The SNB’s policy brought about tight trading ranges for the pair from September 2011 to December 2014, extremes being a high of 1.2649 and a low of 1.9935. However, on January 15, 2015, the bank announced a surprise decision to abandon the peg to the euro. Extreme volatility ensued, resulting in a rapid 30% appreciation of the Swiss franc to the euro.3)Retrieved 26 October 2016 http://www.cnbc.com/2015/01/15/swiss-franc-sours-stocks-tank-as-euro-peg-scrapped.html

The CHF is considered to be a free-floating currency, deriving its value from the open market. Since the removal of the peg by the SNB, EUR/CHF has shown long-term stability, trading from a bottom of near-par to a top of 1.1199.


Key Facts: EUR/CHF

Euro (EUR)

Swiss Franc (CHF)

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