The euro held steady against the Swiss franc on Friday, supported by stronger-than-expected Eurozone business activity data. At the time of writing, EUR/CHF was trading around 0.9243, recovering modestly from an 11-month low near 0.9205 reached earlier this week.
Eurozone activity hits 17-month high
The latest HCOB Flash Eurozone Purchasing Managers’ Index (PMI) report offered a brighter outlook for the region’s economy at the start of the fourth quarter. The composite PMI rose to 52.2 in October from 51.2 in September, marking a 17-month high and extending its streak above the 50.0 growth threshold to ten consecutive months.
Growth was led by the services sector, which recorded its fastest expansion since August 2024, while manufacturing output increased for an eighth consecutive month. New orders rose at the strongest pace in two and a half years, prompting firms to step up hiring after a brief slowdown in September.
Germany, the Eurozone’s largest economy, saw momentum accelerate further. Its composite PMI jumped to 53.8 from 52.0—the highest in 29 months—driven by a robust recovery in services and a modest pickup in manufacturing output.
In contrast, France’s economy continued to lag. The French composite PMI remained below the 50.0 threshold for the fourteenth consecutive month, signaling contraction as weak demand and political uncertainty weighed on business confidence.
Economists noted that France’s sluggish performance continues to act as a drag on the broader Eurozone recovery, tempering the pace of overall growth despite Germany’s strength.
SNB maintains dovish stance amid growth risks
On the Swiss front, minutes from the Swiss National Bank’s (SNB) September policy meeting, released Thursday, confirmed the decision to keep interest rates unchanged at 0%, maintaining an accommodative stance.
Policymakers acknowledged that new US tariffs on Swiss exports are weighing on the outlook and could push GDP growth below 1% in 2026.
While inflation has returned to positive territory, the SNB expects price pressures to remain within its stability range over the next three years. Officials reiterated their readiness to intervene in the foreign exchange market if necessary to curb excessive franc strength. The central bank emphasized that overall monetary conditions remain expansionary, continuing to support domestic activity amid persistent external headwinds.
