SNB: Too early to change its rhetoric regarding CHF – Danske Bank

The Swiss National Bank (SNB) is due to hold its quarterly policy meeting today and the Libor target midpoint and the sight deposit rate will likely both be kept at -0.75%, but they still deem it to be too early for the SNB to change its rhetoric regarding CHF, explains Chief Analyst, Christin Tuxen at Danske Bank.

Key Quotes

“Upside inflation risks and ECB’s continued path towards ‘normalisation’ of policy would be welcomed by the Swiss central bank, but we still think the SNB will need to see EUR/CHF closer to 1.20 before shifting to ‘exit’ mode. Hence, we think the SNB will keep a phrase regarding its ‘currency preferences’, which should help support another leg higher in EUR/CHF over the coming months.”