GBP/CHF Long
The GBP/CHF pair presents a modest upside opportunity in Q1 2025. The Bank of England's (BoE) relatively higher interest rate (4.5%) compared to the Swiss National Bank's (SNB) lower rate (1.75%) supports carry trade flows into GBP. While both central banks signal potential rate cuts in 2025, the UK's GDP growth outlook (1.5%) and inflation moderation (2.8%) suggest a more resilient economic environment compared to Switzerland's slower GDP growth (1.3%) and ultra-low inflation (1.2%). Additionally, easing inflation in the UK may provide room for stable monetary policy, while CHF's safe-haven appeal could weaken in the absence of heightened geopolitical risks.
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