Credit Suisse FX Strategy Research notes that in the market’s eyes, the SNB’s commitment to low (or lower) rates has been somewhat undermined by a lack of clarity within the Governor’s latest messages.
“This has been quietly driving Swiss rates higher. And once the genie about ‘discussing exit’ is let out of the bottle, it’s very difficult to place it back – as the October 2016 ECB ‘taper tantrum’ showed,” CS argues.
What does this mean for EUR/CHF?
We reiterate our 1.095 EURCHF 3-month target. The latest developments also help to justify our 12-month forecast of 1.085,“ CS adds.
Source: Credit Suisse Global Fixed Income Research
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