BofA Recommends Buying AUD/CHF as Geopolitical Risks Ease

Key Facts

In a move reflecting shifting risk appetite in global markets, Bank of America strategists have recommended buying a 3-month digital call option on the AUD/CHF pair. The recommendation sets a target level of 0.5800, following the emergence of a peace memorandum of understanding between the United States and Iran. The bank views this geopolitical development as a catalyst for investors to unwind positions in traditional safe-haven currencies.

The thesis rests on the expectation that the Australian dollar will benefit significantly from the reopening of the Strait of Hormuz, boosting trade and commodity flows. Concurrently, the Swiss franc is expected to be utilized as a funding currency as geopolitical hedges are dismantled, consistent with recent Swiss inflation data showing a slowdown. For context, the NAB Business Confidence report released on June 9, 2026, showed Australian sentiment improving to -14, beating forecasts of -22, per market data.

Looking ahead, upcoming global inflation data will be a primary driver for central bank policy decisions, potentially impacting interest rate differentials between the RBA and the SNB and determining the pair's trajectory toward the 0.5800 target.