EUR/CHF seen at 1.15 in 12-month – Danske Bank

Senior Analyst at Danske Bank Mikael Milhoj sees the Swiss Franc slipping back to the 1.15 area vs. the single currency within a year’s view.

Key Quotes

“In the FX market the Macron win turned out to be a ‘buy the rumour, sell the fact’ event in the sense that while a (muted) relief rally was seen in EUR crosses on impact, EUR/USD swiftly fell back to below 1.10 again and both EUR/JPY and EUR/GBP reversed initial gains on Monday”.

“Notably, EUR/CHF sustained the move higher above the 1.09 level and is now trading at levels not seen since autumn last year. Indeed, with EU political risks having receded for now, the safe haven of Swiss and firmly negative rates looks increasingly less attractive for foreign investors”.

“With possible support for the single currency from an ECB becoming a little more hawkish near term, EUR/CHF tailwinds are set to stay in place; we still look for the cross at 1.15 in 12M”.