News & Analysis

In response to the ECB’s unexpected hawkish shift and the subsequent adjustment in bond market pricing, we have revised up our near-term EURCHF projections from February’s submission. Over a longer timeframe, given expectations of a stronger regional and global economic backdrop, we expect the Swiss Franc has room to depreciate against the majority of the G10. The recent hawkish repricing for the ECB and the following spike in EURCHF means our forecasts are now flatter compared to earlier projections as further CHF weakness is likely to be counteracted by SNB policy measures in order to limit the inflation pass-through. Risks to our new forecasts are largely balanced; further action by the ECB in the near-term may be offset by the central bank providing a pathway for the SNB to follow suit out of negative interest rates, while a material escalation in Russia-Ukraine tensions is as likely as a de-escalation in our subjective view.

Read Monex’s February 2022 CHF Outlook here:

DOWNLOAD THE FULL REPORT

 

Author: Ima Sammani, FX Market Analyst

 

Disclaimer
This information has been prepared by Monex Europe Limited, an execution-only service provider. The material is for general information purposes only, and does not take into account your personal circumstances or objectives. Nothing in this material is, or should be considered to be, financial, investment or other advice on which reliance should be placed. No representation or warranty is given as to the accuracy or completeness of this information. No opinion given in the material constitutes a recommendation by Monex Europe Limited or the author that any particular transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research, it is not subject to any prohibition on dealing ahead of the dissemination of investment research and as such is considered to be a marketing communication.