Against the backdrop of elevated price pressures, economists at CIBC Capital Markets expect the Swiss National Bank (SNB) to be increasingly prepared to tolerate a stronger franc.

Additional policy tightening

“In the context of elevated CPI, we can expect the SNB to remain wary of elevated price pressures feeding through into wage demands; this comes as the unemployment rate is at a 20-year low of 2.1%.”

“A central bank keen to bear down on wage growth and an overheated real estate market could prove to be more activist than the ECB, supporting a stronger CHF into 2023.”

“EUR/CHF: Q4 2022: 0.94 | Q1 2023: 0.97”