EUR/CHF: fresh pressures coming up - Rabobank

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Mar 16, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Oct 7, 2015
    Likes Received:
    Analysts at Rabobank explained that they still expect more measures from the ECB this year (probably as soon as September) – via a cut in the deposit rate - with fresh pressure on the EUR/CHF currency pair.

    Key Quotes:

    "...which could trigger more action from the SNB. First, via additional currency purchases and as soon as 16 June via a cut in the deposit rate from -0.75% to -1.00%.

    There are certain limits to what the SNB can do, and we do not believe the bank will cut further than -1.25% (perhaps already in December this year). We also believe the SNB will face political headwinds in the case that its total balance sheet exceeds 105-110% of nominal GDP. We would therefore argue that the amount it could buy is for the time being limited to another CHF 50bn."
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