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Chief Analyst at Danske Bank Christin Tuxen expects the cross to reach the 1.2300 zone in the longer run.

Key Quotes

EUR/CHF has stayed close to the 1.20 level but has yet to make a firm break of the old SNB floor on the cross. With trade war tensions easing, geopolitical risks abating slightly and Italian bond markets complacent even with the prospect of an anti-establishment government, CHF strength should be kept at bay for now. However, a significant move above 1.20 is difficult as long as the ECB remains ‘normalisation’ hesitant. In any case, the money market remains too optimistic on the timing of a first SNB hike; a key next step will be for the SNB to stop characterising CHF as ‘highly valued’. We think it will remain reluctant to change its course, which should allow EUR/CHF to edge firmly into the 1.20s this year as the ECB keeps its ‘exit’ process alive”.

“We still look for the cross to trade at 1.19 in 3M, 1.21 in 6M and 1.23 in 12M (all unchanged); we see the cross at 1.19 in 1M”.