USD/CHF:  Political developments could strengthen the Swiss franc more than forecast - CitiBank

Analysts at CitiBank, forecast the USD/CHF at 1.00 in a 1-3 month period, at 0.98 in 6-12M and around 0.92 over the long term. 

Key Quotes: 

“The main risks to our forecasts are developments politically in the region. Should Brexit related or Italian budgetary risk premia rise, we envisage more CHF strength than forecasted.”

“The SNB continues to cite a “highly valued” currency and “fragile” market backdrop as reasons to justify negative interest rates and FX intervention. As we expect the inflation outlook to remain subdued, particularly due to oil price base effects, the SNB most likely remains on hold for the foreseeable future.”

“Since the RSI stayed at neutral territory, USD/CHF may range trade between 0.9789-1.0171.”