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“At the bottom of the G10 league since January 21 are the NOK, the AUD and the NZD,” note Rabobank analysts.

Key quotes

“These three currencies have been undermined either by the downside pressure on commodities prices and/or by their strong trade links with China. The safe haven properties of the JPY and the CHF are well documented. Both Japan and Switzerland run healthy current account surpluses and while Japan has a budget deficit, this stood at a relatively confined 2.6% of GDP in 2019.”

“Additionally both countries have highly credible legal and financial systems while liquidity in both the JPY and CHF is ample. Between early October 2019 and mid-January JPY/CHF trended lower. We would link this with the improvement in risk appetite associated with optimism about the phase 1 trade deal between the US and China.”

“While this lifted risk appetite across the board, flows in and out of the JPY often appear more sensitive to Asian centric risks while the safe haven flows to and from the CHF can be heavily dependent on the news pertaining to the Eurozone. That said, insofar as the SNB maintains FX intervention as a policy tool, we generally favour the JPY over the CHF as a safe haven.”