Forecast: BEARISH

Inflation in Switzerland is currently at 0.8% and the Swiss National Bank is struggling to meet their 2% target. It is predicted that this target will not be met until 2020.

With inflation and interest rates so low, CHF will not be an attractive long term investment. However, other economic data could produce short term moves throughout the year.

It is worth noting that CHF is considered a safe haven currency which increases in value when markets are facing uncertainty. However, these gains do not last long unless something significant happens such as a financial crisis.

The Swiss National Bank has also said that they do not want CHF to strengthen. Particularly against EUR as this helps boost sales to Europe. This increases the amount of money being injected into the economy, which therefore helps inflation reach the bank’s 2% target.

 

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