EUR/CHF to stay offered near 0.95 multi-month, any rallies to prove fleeting – ING

Swiss National Bank (SNB) meets today. Economists at ING analyze EUR/CHF ahead of the Interest Rate Decision.

SNB to hike the policy rate by 25 bps 

A 25 bps hike in the policy rate to 2.00% is widely expected. Also expected is commentary that the SNB will be using the Swiss Franc to meet its monetary goals and that it will continue to sell FX. 

In what should be a familiar story now, the SNB is trying to keep the real Franc stable for monetary purposes, which in practice means engineering a stronger nominal Swiss Franc. Given the strong Dollar, it seems the SNB will have to try harder to get EUR/CHF lower to deliver that nominal CHF strength. 

Expect EUR/CHF to stay offered near 0.95 multi-month and any rallies to prove fleeting.