CHF flows: New -post-2015 low in EUR/CHF

EUR/CHF has made a new post-2015 low this morning, dipping below 0.92 driven by optimism over the potential for a new trade deal with the US that is expected to reduce the tariff on Swiss goods from 39% to 15%. Of course, this just puts Switzerland back on a par with the EU, so it’s unclear why it should lead to new CHF highs, especially since the SNB have already cut rates to zero in the last year. These are, of course, new post-2015 highs in nominal rather than real terms against the EUR, but they also represent new post-2015 highs in real terms on a trade-weighted basis. The initial break below 0.92 has been reversed, but the bounce has been modest and it seems likely to require some action from the SNB to prevent further declines, with the more negative equity market tone also helping to support the CHF.