EUR/CHF: Set to stay low near term on political uncertainty – Danske Bank

According to Jens Nærvig Pedersen, Senior Analyst at Danske Bank, political uncertainty in Europe, coupled with rising geopolitical risks following the election of Donald Trump as the next US president, has supported CHF and put pressure on SNB to act to curb CHF appreciation pressure.

Key Quotes

“Political uncertainty looks to be a key theme for FX markets again this year. EUR/CHF is still trading close to 1.07. We expect it to stay here in the near term as focus turns to European political uncertainty.”

“Longer term, we continue to expect fundamentals to support a higher EUR/CHFandkeepour6M and12M forecasts unchanged at 1.10 and 1.13, respectively.”