The euro to Swiss franc (EUR/CHF) will be in the spotlight this week as it hovers near its lowest level since 2015. The pair has been in a freefall this year as it slipped by more than 6.50% from its highest point this year.

The EUR/CHF pair will be in focus this week as the European Central Bank (ECB) and the Swiss National Bank (SNB) deliver their final submissions of the year. 

These two meetings come at a time when the Swiss franc has gained sharply against the euro and the US dollar. Last week, the currency jumped to its highest level since the SNB removed its peg against the euro.

Economists believe that the two central banks will maintain their status quo and leave rates unchanged. The ECB will leave its benchmark rate intact at 4.35%, where it has been at in the past few months.

Recent data showed that the bank is achieving its inflation target. According to Eurostat, the country’s inflation dropped to 2.4%, a few points above its target at 2.0%. A sharp decline of energy prices has helped to stabilise prices recently.

At the same time, there are signs that the bloc’s economy is still slowing as most countries are on the cusp of moving into a recession. PMI numbers published last week showed that the bloc’s activity remained below 50.

The Swiss economy is also slowing, with inflation falling below 2%. Therefore, a survey of economists by Bloomberg showed that the bank will first cut its interest rates in September next year. Some of them see it slashing them in June. In a note, an analyst at Bantleon said:

“With October and November readings so much lower than expected, I don’t see any other way than the SNB visibly cutting its forecast next week.”

Notably, the ECB and SNB decisions will come a day after the Federal Reserve delivers its. Economists believe that the Fed will leave rates unchanged and provide hints of what to expect in the coming months.

EUR/CHF chart by TradingView

The EUR to CHF pair has been in a strong bearish trend in the past few weeks. It slipped below the key support at 0.9409, which was its lowest point in September 2022. The pair retested its January 2015 lows.

The pair has remained below the 50-day and 100-day moving averages. It also invalidated the double-bottom pattern by falling below the key support at 0.9422. In most cases, the double-bottom pattern is one of the most bullish signs.

Therefore, the pair will likely continue falling in the coming days. If this happens, the next level to watch will be at 0.9400 ahead of the upcoming ECB and SNB decisions.

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