1730 GMT/1230 US Eastern time: Speech by member of the board of the Swiss National Bank Petra Tschudin and Thomas Moser, "The Swiss Repo Market: 25 Years of Success for the Financial Centre and the National Bank", Money Market EventPetra Tschudin is the a member of the Governing Board of the Swiss National Bankalso Head of Department III (Money Market and Foreign Exchange, Asset Management, Banking Operations and Information Technology, as well as the Singapore branch office) in ZurichThomas Moser is an Alternate Member of the Governing Board of the Swiss National Bank.[embedded content]

Tags: central-banks,Featured,newsletter

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Swiss National Bank Chair Jordan threatened FX intervention!
A couple of posts from Tuesday ICYMI while Powell was hogging the spotlight:
ECB Knot: ECB can be expected to keep raising rates for quite some time after March
ECB can be expected to keep raising rates for quite some time after March
And, SNB Chairman: We cannot rule out that we will have to tighten monetary policy again
We can use interest rates but also sell foreign currencies to get the right monetary conditions
Check out those linked posts for more.

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Tags: central-banks,Featured,newsletter

This is via the folks at eFX.
For bank trade ideas, check out eFX Plus. For a limited time, get a 7 day free trial, basic for $79 per month and premium at $109 per month. Get it here.

Barclays Research discusses CHF outlook and targets EUR/CHF around 0.97, 0.97, 0.98, and 1.00 by end of Q1, Q2, Q3, and Q4 of next year respectively.
“We expect CHF to remain at the higher end of its historical range, with EURCHF trading around parity for the next few quarters. CHF remains an effective risk and inflation hedge in a slow growth/high inflation environment for European economies. In addition, large inflation differentials versus trading partners require offsetting nominal CHF appreciation. A faster China reopening, and an earlier-than-expected resolution of the

Swiss National Bank monetary policymaker Andrea Maechler is speaking at 1130 GMT, at an event titled:
After the interest rate change: high inflation, rising interest. How will it affect the Swiss economy?
In September:
SNB raises policy rate by 75 bps to 0.50%, as expected
EUR/CHF has been recovering from its recent lows:

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This via the folks at eFX.
For bank trade ideas, check out eFX Plus. For a limited time, get a 7 day free trial, basic for $79 per month and premium at $109 per month. Get it here.
Goldman Sachs maintains a bullish bias on CHF going into this week’s SNB policy meeting. “We are bullish on the Franc. We believe that the SNB is a stricter inflation targeter than its peers, and better equipped to meet the challenges facing policymakers across Europe at the moment. This week’s SNB meeting presents a tactical challenge for the Bank after the ECB hiked by 75bps, and seems likely to do so again in October, while the SNB does not have another scheduled policy assessment until mid-December,” GS notes. “We believe this challenge could be overcome with a large (100bps, or

The SNB announcement is due on Thursday at 0730 GMT.
This in brief via Standard Chartered:
expect SNB to hike by 100bp
Stan Chart were at +50bp but have ramped their expectation much higher. Add that this takes:
the base rate to 0.75% from -0.25%, and out of negative territory for the first time since 2014
More:
We believe positive currency rhetoric from the SNB and increasing hawkishness among major central banks support our larger-than-consensus rate hike forecast; most economists are predicting a 75bps hike, though markets are pricing in around an 86bps step
Note the SNB monetary policy committee (MPC) sets rates only once every quarter; we forecast a further 50bps of hikes each at the ECB’s October and December meetings. We see a further 75bps of tightening by

SNB monetary policy meeting preview
The SNB policy decision is due on Thursday (see for timings)
Via MUFG Bank:
CHF has been the top performing G10 currency so far this month as it has strengthened sharply against both the EUR (+2.2%) and USD (+1.5%).
It has regained upward momentum against our equally-weighted basket of other G10 currencies after a period of consolidation at higher levels between July and August. The CHF’s renewed upward has once again coincided with an abrupt hawkish repricing of SNB rate hike expectations similar to in June.
Market participants are increasingly confident that the SNB will continue to play catch up with major central banks and deliver a larger 100bps hike in the week ahead (Thurs) to combat upside inflation risks. There are

This via the folks at eFX.
Credit Agricole CIB Research argues that it would be premature for the SNB to resume its intervention against CHF strength around current levels.
“We note that the wild fluctuations of global bonds, stocks and exchange rates may make it more difficult for market participants to find a “concrete indication” of FX intervention from the data,” CACIB notes.
“We further think that following the hawkish shift of its policy outlook in June, it would be premature for the SNB to resume its intervention against CHF strength especially given that the recent FX spot moves have been far from disorderly and the CHF-valuation on a real basis does not appear extreme,” CACIB adds.

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Swiss National Bank President Thomas Jordan spoke at the Federal Reserve’s annual Jackson Hole symposium on Saturday.
“Structural factors such as the transition to a greener economy, rising sovereign debt worldwide, the demographic transition and ultimately also the fact that globalization appears to have peaked — at least temporarily — could lead to persistently higher inflationary pressure in the coming years”
“There are signs that inflation is increasingly spreading to goods and services that are not directly affected by the pandemic or the war in Ukraine”
higher prices are being passed on more quickly
inflation expectations “have also been moving upwards slightly”
a decline in global economic integration could increase companies’ price-setting power, meaning

On Saturday at the Jackson Hole symposium there will be speakers from the European Central Bank, Swiss National Bank and Bank of Korea.
We may get some clues on what’s coming up from the ECB:
Powell’s speech at Jackson Hole is the second-most important
Saturday’s item of interest (1625 GMT)
 

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This via the folks at eFX.
Danske forecast via eFX:
“We expect the SNB to hike by 50bp again in September and December to curtail underlying inflation pressures bringing the policy rate to 0.75%. With the SNB broadly following the ECB, we see relative rates as an inferior driver for the cross,” Danske notes.
“We continue to forecast the cross to move lower on the back of fundamentals and a tighter global investment environment. We thus lower our overall forecast profile and now forecast EUR/CHF at 0.93 in 12M,” Danske adds.

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Tags: central-banks,EUR/CHF,Euro,Featured,newsletter

Goldman Sachs discusses CHF outlook and maintains a bullish bias over the medium-term.
‘The SNB surprised markets with a 50bp hike last week and a change to its intervention framework.
The move confirms our bullish view on the Franc and is the strongest evidence yet of our “Reverse Currency Wars” thesis-the era of targeting weaker exchange rates is over (and accelerating through the year) is probably too high relative to the SNB’s inflation aim.
The Bank’s research and our own have found that a 1%appreciation in the currency can lower inflation by about 0.1-0.2%. Taken together, we think the Bank is likely to target about a 5% appreciation in the real exchange rate, which would put it around the post-2015 average,” G
“With this in mind, we are rolling forward