Preview of the Swiss National Bank meeting today from Societe Generale, Nomura, Credit Suisse, and Credit Agricole
Via eFX
They’re
luck’s in. With EUR/USD above 1.10 there is no pressure to the downside
in EUR/CHF. In January the market was (very) short CHF and building a
short EUR position that wasn’t yet very big. That was a recipe for
pressure on the floor to build and at the same time, for a huge move
once the floor was broken. Now, the market is more balanced, and Euro
shorts are being reduced, not built. A rate cut may still be necessary
in due course, because the inability of the Swiss financial system to
re-cycle excess savings post-GFC hasn’t been resolved, but judging by
how unpopular it would be with pension providers, let alone Joe Public,
there’s a good chance they do nothing, and that EUR/CHF holds
comfortably above 1.0750 and within the recent range.
ps. Earlier: