Which driver weakened the Swiss franc?

The weakening of the Swiss franc can often be attributed to changes in interest rate expectations because these expectations have a significant impact on currency values. When interest rates are expected to change, it affects the attractiveness of holding assets in that currency. If investors perceive that the Swiss National Bank is likely to lower interest rates, the yield on investments in Swiss francs becomes less appealing compared to other currencies. This can lead to capital outflows as investors seek better returns elsewhere, thereby increasing the supply of Swiss francs in the market and causing the currency to weaken.

In contrast, while net export expectations, inflation expectations, and valuation expectations also influence currency fluctuations, they typically do so in different or less immediate ways. Changes in export expectations might affect the currency over a longer term through trade balances, while inflation expectations can influence central bank policies but are not as directly tied to immediate currency movements as interest rate expectations. Valuation changes tend to be more subjective and based on market sentiment rather than concrete policy shifts, making them a less direct driver of currency value. Thus, the strongest and most immediate factor in this context is indeed the surprise change in interest rate expectations.