(05 MARCH 2018)DAILY MARKET BRIEF 2:CHF will weaken, as national bank profits

Some of the risk that has boosted the Swiss Franc is deflating. Germany’s grand coalition is now firmly on track, and US President Trump’s trade war is more likely a threat than a reality. Italy’s elections were somewhat indecisive, which means that a game-changing shift towards anti EU policy is not imminent. We remain negative on CHF against USD and EUR. 

Meanwhile, the Swiss National Bank turned in bumper results for 2017: profit of CHF 54.4 billion, up 29% from 2016, with CHF 49.7 billion earned in foreign currencies and CHF 3.1 billion from gold holdings. The central and the cantonal governments will be cheering, because they will share a profit distribution of CHF 2 billion. 

By Peter Rosenstreich