EUR/CHF eyes 1.1800 in 6-month – Danske Bank

Christin Tuxen, Chief Analyst at Danske Bank, sees the cross edging higher towards the 1.18 area in the medium term.

Key Quotes

“While the ECB has entered ‘normalisation’ mode, the SNB has been keen to stay out of ‘exit’ discussions and used every opportunity to stress that it is in no hurry to quit negative rates and that intervention remains a policy tool”.

“Indeed, the SNB is keen to embrace the pricing of an eventual ECB exit from negative rates and QE and a continued uptick in EUR/CHF with it. As the SNB has confirmed it remains in the ‘no exit now’ camp, we deem the central bank will be more than happy to let EUR/CHF edge towards 1.20 as currency help on inflation remains much needed”.

“We have kept our forecast profile unchanged and thus continue to now see the cross at 1.15 in 1M, 1.15 in 3M, 1.18 in 6M, and 1.23 in 12M”.