No change expected from the SNB next week - RBS

FXStreet (Łódź) - Nick Mannion from RBS suggests that the introduction of negative rates by the SNB is possible but that it won't happen in the nearest future.

Key quotes

"They would likely be very effective at countering CHF appreciation. But there are risks in terms of implications for the housing market and financial system."

"Should EUR/CHF decline to the floor, expect FX intervention first to prevent a print below 1.20."
"Negative rates could then emerge if FX reserves began to build rapidly."

"But we are not convinced this would be the case, with EUR/CHF declines driven more by broad-based EUR weakness rather than demand for CHF assets."

"We expect no change from the SNB next week and a continued grind lower in EUR/CHF back towards the floor."