Chart of the day: Swiss franc on weakening path
Rather than the unlimited access via “equivalence” to the financial markets in the European Union that Switzerland had paid €1 billion (US$1.2 billion) for, Brussels on Thursday decided on a 12-month agreement only, pending broader negotiations about their bilateral relationships. This added to the developed world’s tendency to higher interest rates – or less negative ones in Switzerland – sparked by US President Donald Trump’s tax reform victory. In turn, the Swiss franc moved to its weakest level this year and close to levels last seen before the currency peg to the euro was dramatically ditched in January 2015. This was music to the Swiss National Bank’s ears and a move that, with a little luck, ought to extend through to 1.20 francs (US$1.21) – before the drama began.
Nicole Elliott is a technical analyst