Credit Agricole CIB Research maintains a bearish bias on CHF targeting EUR/CHF around 1.12 by year-end.
"When it comes to the SNB, we expect it to continue doing its utmost to prevent policy differentials from diverging. After all, the overvalued currency itself is treated as a key driver of overly tight monetary conditions which suggests a policy mix consisting of negative rates and currency intervention if needed will stay in place for longer and regardless of any external criticism. So much may ultimately even help to increase the CHF’s funding attractiveness from here," CACIB notes.
"View wise, we continue to target EUR/CHF at around 1.1200 by end 2021 with more upside expected in 2022," CACIB adds.