According to the Vice President of the SNB, the Swiss Franc remains too strong versus the common European currency. Nevertheless, the excessive strength will vanish soon without any intervention.
It should be noted that the strengthening of the Swiss currency has recently had a negative impact on the Swiss economy, which is an export-oriented one. Last year, the SNB introduced the limit for EURCHF at 1.2000, thereby preventing the collapse of the Swiss economy. The bank is still defending the level.
The Vice President says he doesn’t expect a eurozone breakup. As for the concerns over a possible price bubble in the Swiss housing market, he says the market is recovering mostly due to low mortgage rates, higher inflow of foreign capital and lower unemployment. In general, the situation worries the SNB. The central bank is working on another housing market report and will publish it prior to making a new forecast.
Forex.
The chart below, courtesy of , reflects the current state of affairs in the market of USDCHF. The currency pair is recovering from the recent downswing. Therefore, the Swiss Franc is still strong against the US Dollar. A break below 0.9213 will resume the downtrend. If this is the case, 0.9162, 0.9130 will act as levels of support.
