The franc has been on the back-foot of late, mainly on the back of stabilising risk sentiment. Next week, it will become more active in terms of domestic data releases. Both employment and inflation data will attract attention. However, price developments are likely to remain muted enough in order to keep the SNB in a position to consider additional policy action if needed.
Given the importance of EUR/CHF as a driver of monetary conditions and as a more aggressive ECB policy stance may increase downside risks to the cross, the risk of the SNB acting anew in the short- to medium term should not be underestimated. If anything we remain of the view that CHF should be sold on rallies, against both the EUR and USD.
This is also due to the notion that risk sentiment has more room to improve on the back of further falling expectations of the global economy falling back into a recession.
PS: Copy signals, Trade and Earn on Forex4you - https://www.share4you.com/en/?affid=0fd9105
