Credit Agricole CIB FX Strategy Research notes that given there is little scope of the SNB considering a change in stance anytime soon, a policy mix consisting of negative rates and currency intervention will stay intact.
"With the SNB likely to keep interest rates low for longer as compared to the ECB there is room of diverging monetary policy expectations to the benefit of crosses such as EUR/CHF. It may be true that increased political uncertainty as related to Germany and Spain as well as geopolitical tensions have increased safe haven demand for the franc.
However, we do not expect these developments to have sustainable impact on sentiment. It must be remembered too that the SNB’s aggressive stance with respect to currency intervention is likely to keep the franc’s safe haven appeal low," CACIB argues.
In line with this view,.