Swiss Franc Forecast – CHF no longer the safe haven it was?
The Swiss Franc had benefited extremely well throughout the global economic crisis, however since the lows of 1.17 seen
against the Pound the tide appears to be slowly turning back.
Rates at present are roughly around 1.50 and it appears that the CHF is no longer as high in the rankings when it comes to investors choice of safe havens. I have also heard that the Swiss are now preparing exchange controls as they feel the Euro may collapse.
This could involve a number of options including the following:
- Banning the use of foreign
currency within the country - Banning locals from possessing
foreign currency - Restricting currency exchange
to government-approved exchangers - Fixed exchange rates
- Restrictions on the amount of
currency that may be imported or exported
Personally I feel we could see the Government raise the bar on the 1.20 artificial pegging against the Euro at the moment however this has already proved very difficult and quite costly for them to maintain. Either way, my personal opinion is to expect the Swiss Franc to weaken further in the near term, potentially being nearer to 1.60 by the end of June.
If you are currently working in Switzerland and being paid in CHF it may be worth considering the options available to you inclusive of a stop loss, limit order or forward contract to protect you from adverse market movements.
If you do have a requirement such as this then feel free to contact me directly djw@currencies.co.uk and I shall be more than happy to assist you.
