7 Apr 2015
Risks of SNB intervention rising again – RBS
FXStreet (Barcelona) - Melinda Burgess, FX Strategist at RBS, notes that with SNB concerned over the impact of a strong CHF, and EUR/CHF falling since mid-March, an intervention by the central bank is highly likely.
Key Quotes
“EUR/CHF has been falling and trade weighted CHF has been rising since mid-March. This is unlikely to have gone unnoticed at the Swiss National Bank which is concerned over the impact of a strong currency on the economy and inflation.”
“The latest sight deposit data showed little sign of intervention, but with EUR/CHF now below 1.04, the SNB’s willingness to stem further exchange rate strength may again be tested. Hence this week’s inflation data may be important.”
“While Greek funding talks drag on, there is potential for some further downside pressure on EUR/CHF, meaning the risk of further SNB action remains high.”
Key Quotes
“EUR/CHF has been falling and trade weighted CHF has been rising since mid-March. This is unlikely to have gone unnoticed at the Swiss National Bank which is concerned over the impact of a strong currency on the economy and inflation.”
“The latest sight deposit data showed little sign of intervention, but with EUR/CHF now below 1.04, the SNB’s willingness to stem further exchange rate strength may again be tested. Hence this week’s inflation data may be important.”
“While Greek funding talks drag on, there is potential for some further downside pressure on EUR/CHF, meaning the risk of further SNB action remains high.”