EUR/CHF stays wary on the ECB – Danske Bank

Mathias Mogensen, Analyst at Danske Bank, assessed the potential prospects for the cross.

Key Quotes

“Elsewhere among the majors, we note the very muted downside reactions in EUR/JPY and EUR/CHF following the ECB minutes which suggest that the FX market is looking for a bit 'less acceptance of USD weakness' among central banks rather than outright EUR weakness”.

“Indeed this ‘differential’ price action in EUR crosses makes sense as both BoJ and SNB have been keen to stay out of exit talk, thus leaving less potential for a repricing of these/their currencies after the dovish ECB message”.

“We note that EUR/CHF saw a somewhat muted reaction when EUR/USD jumped during July, and we could certainly see EUR/CHF a tad weaker near term as a hesitant ECB is not good news for SNB”.