Bank of America Global Research discusses CHF outlook and sees a scope for a renewed weakness on the back of CHF funds outflow.
"An important channel through which we think CHF is likely to weaken is the flow of funds channel - the Q4 balance of payments data reveals significant shifts in the Swiss capital account position. Our analysis reveals that foreign investors were net sellers of Swiss equities whilst Swiss investors have been net buyers of foreign equities. We have written extensively on the safe haven properties of the CHF and the inflows that Swiss assets have experienced in recent years," BofA notes.
"The balance of payments data suggests that some of those safe haven flows are being unwound, though it is arguable whether EUR has been a beneficiary of this. We think not and continue to argue that the decoupling thesis between Eurozone and Switzerland is not as compelling as it is versus other G10," BofA adds.