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Jun 14 - 12:55 AM

Danske Bank: EUR/CHF Ahead of SNB June Meeting

By eFXdata  —  Jun 13 - 04:30 PM


Danske Bank provides insights into the EUR/CHF outlook ahead of the Swiss National Bank (SNB) meeting on June 20. The analysis highlights key factors influencing the cross, including recent market movements, political uncertainties, and potential SNB actions.

Key Points:

  1. Recent EUR/CHF Movements:

    • EUR/CHF has fully retraced the move higher following the SNB's cut in March, now trading close to the 0.96 mark.
    • The retracement is attributed to political uncertainty in France and a stronger CHF.
  2. SNB Meeting Expectations:

    • Danske Bank previously argued that the SNB would remain on hold at its upcoming meeting due to stronger growth in Switzerland, persistent global inflation pressures, and recent hawkish remarks from SNB's Jordan.
    • The recent decline in EUR/CHF and the SNB's focus on the currency present the biggest risk to this call.
  3. Potential SNB Actions:

    • If the SNB opts to keep rates unchanged, this would provide immediate support to the CHF, though Danske Bank expects this support to be short-lived.
    • Markets are likely to fully price in a September cut and consider a December cut as well.
    • If the SNB decides to cut rates, this would weaken the CHF.
    • Possible FX intervention by the SNB would also favor a weaker CHF.


Danske Bank favors a weaker CHF over the next couple of months, despite the current market movements and political uncertainties. The SNB's decision at the upcoming meeting will play a crucial role in determining the near-term direction of EUR/CHF. An unchanged decision may provide temporary support to the CHF, but markets are expected to anticipate future cuts, leading to a weaker CHF. A rate cut or FX intervention by the SNB would further weaken the CHF.

Danske Research/Market Commentary


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