SNB does nothing to weaken the Swissie – UBS

By FXStreet FXStreet (Córdoba) – The EUR/CHF exchange rate fell slightly after the Swiss National Bank (SNB) released its quarterly monetary assessment. According to the UBS analyst team, for the time being there is nothing in the SNB communication that makes us believe EUR/CHF will leave its current 1.05-1.10 range.

Key Quotes

“This reaction, in our view, is in line with the fundamental track the SNB has taken: though inflation for this year and next is forecast to drop lower than previously anticipated, the SNB has not unveiled any new policy ideas to stabilize long-term inflation expectations. In fact, there was no hint of a policy change and no discussion of new tools that could be used should deflation/disinflation persist and the Swiss franc stay strong for a prolonged time. In short, the SNB did not present any policy action that would weaken the Swiss franc at this moment”.

“The policy action presented on Thursday is based on the principle of hope. Hope that the US Federal Reserve will raise rates Thursday and reinforce the market speculation that it will follow through with a series of rate hikes. Hope that the oil price will stabilize or even rise, which would push overall inflation rates …read more

Source:: FX Street