Swiss Franc: Weakness Could be a Sign of SNB Intervention

The Swiss Franc's multi-week run of gains might have as much to do with a positioning unwind as it does with a recent spike in investor demand for 'safe haven' assets, according to new research from Goldman Sachs.

The Swiss Franc has been a standout underperformer among major currencies in the last week but could fall further in the weeks and months ahead, according to analysts at BofA Global Research, who say it’s the most vulnerable among major currencies to a recovery in U.S. bond yields.

The Pound-to-Swiss Franc exchange rate was testing three-month highs early in the new week, a break above which could lead Sterling into a 1.28-to-1.3255 trading range, although economic developments and the trajectory of the U.S. Dollar will have the final say.

The Swiss Franc was underperforming most other major currencies on Thursday as the Swiss National Bank’s (SNB) latest policy guidance looked to have upset foolhardy investors who’ve been betting the bank might lift its interest rate over the coming years.