On the Swiss National Bank and their ER/CHF policy.
Although the SNB did not confirm any involvement in the market it comes as a fair assumption that the central bank did limit any downside to EUR/CHF.
This comes as no surprise after SNB board member Maechler already indicated that any currency in reaction to any adverse political developments will be fought. Keeping in mind that the overvaluation of the currency is regarded as the main cause of keeping monetary conditions too tight and therefore preventing inflation from improving sustainably, we seem limited scope of this to change anytime soon. This in turn should keep a floor below EUR/CHF.
Given more favourable policy differentials majors such as USD/CHF may be poised to retest parity and break above soon, especially if global risk sentiment were to improve further as we expect.
In terms of domestic events the main focus will be on speeches. SNB's Maechler will once again speak and he is likely to defend the need to maintain an aggressive policy stance.
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Hi, I'm Thomas Jordan from the Swiss National Bank and I'm here to help you with your CHF trading!
