Foreign exchange market update: EUR/CHF <1

Foreign Exchange Market Update EUR CHF - amnis
  • News
  • Currency exchange

EUR/CHF below 1.0000

The status of the Franc as a “safe haven” is unbroken and in the course of the escalation in Ukraine, a rate below EUR/CHF 1.0000 was reached for the first time since 2015.
This is likely to have called the Swiss monetary authorities into action. The SNB’s increased sight deposits suggest that the EUR/CHF exchange rate was supported by the central bank. If EUR/CHF moves towards 1.0000, further buying by the central bank can be expected in the short term.

Despite the fact that interest rates in Switzerland are still negative, demand for Swiss francs is unbroken and even rising inflation coupled with negative interest rates is not deterring market participants to buy more Francs. However, one thing is clear: the specter of deflation is history for the time being and the SNB could also tighten interest rates if prices continue to spiral upwards.

For EUR/CHF the overall picture remains clouded for the time being and only an end to the conflict in Ukraine could lift the currency pair back into the well-known trading range of 1.0500-1.1200.

Downtrend since 2021

From a technical point of view, we have been in a downtrend since March 2021. A strong support zone could form in the 1.0000/0.9980 area after the Euro’s sharp fall.

Support 0.9980-1.0000

Resistance 1.0400
Resistance 1.0500

The chart below shows the current EUR/CHF downtrend:

FX Market Update EUR CHF - amnis
Source: TradingView

An end to the war in Ukraine could trigger a trend reversal in the currency pair. A sustainable move above the price mark of EUR/CHF 1.0500 is necessary for this. Continue to monitor central bankers’ comments for potential policy adjustments.

For more information on the foreign exchange market, please feel free to contact our forex experts!

Please note that this elaboration was completed on 28/03/2022 11:01 CET.
This article is for informational purposes only and does not take into account the particular circumstances of the readers. It does not constitute financial advice. The content of this article is not intended as an offer or solicitation to buy or sell any fx or to take any other action and are not intended to form the basis or part of any contract. Clients should seek independent professional advice and draw their own conclusions with respect to the suitability of the transaction, including its economic merits and risks.The information contained in this article is public data and has been obtained from sources believed by amnis to be reliable and accurate. Amnis Treasury Services AG makes no warranty or representation as to its correctness, accuracy or completeness for a particular purpose. Neither Amnis Treasury Services AG nor any of its employees shall be liable for any damages whatsoever arising out of the use of this article, its contents or otherwise.

Set up rate alert
Gerhard Scharinger
Gerhard Scharinger is the Head Markets of amnis. He is an expert in Foreign Exchange, Treasury Management, Economics and Hedging. Besides various published articles and foreign exchange news he is also an international speaker at different events. Follow him and amnis on LinkedIn, Twitter and Facebook to keep up with the latest industry news and insights.
Cookie Consent with Real Cookie Banner