Euro remain steady against Swiss Franc amid lower oil prices, German manufacturing momentum

EUR/CHF remains flat after recovering daily losses, trading around 0.9170 during European hours on Thursday. The currency cross may see upward momentum as the Euro (EUR) gains support from falling crude oil prices. Oil prices declined following a Democratic sweep in the US midterm elections, which heightened expectations that the Trump administration will face increased pressure to end the conflict with Iran. President Donald Trump acknowledged that Republicans suffered election losses largely due to the war and rising gasoline prices, while signaling no immediate plans to ramp up military strikes.

Economic data from Germany may also provide support for the Euro, indicating renewed momentum in the region's largest economy. Germany’s Factory Orders rose by 3.3% year-over-year in September, improving upon the revised 3.2% increase seen in the previous month. On a month-over-month basis, order volumes for German-manufactured goods rebounded by 4.4% following a sharp 10.1% decline in August, though the figure fell short of the forecasted 4.8% growth.

Further backing for the Euro came from hawkish comments by European Central Bank (ECB) officials, who indicated that additional rate hikes may be needed to contain inflation and prevent a wage-price spiral.

However, the EUR/CHF cross faces downside risks as the Swiss Franc (CHF) finds strength of its own. Swiss inflation unexpectedly accelerated to 1.5% year-on-year in October, casting doubt on whether the Swiss National Bank (SNB) can avoid tightening its monetary policy through 2027.

SNB hawkish tilt revives interest in the Franc and pressures EUR/CHF

Analysts at ING argue that a shift toward a more hawkish SNB stance is “quite a clean positive for the Swiss franc,” recalling that “traders will remember 2023, when the SNB actively drove the franc stronger and sold FX as part of its tightening toolkit.” Against that backdrop, they “expect to see even more interest in the Swiss franc over the coming months, with downside risks to EUR/CHF forecasts.”