Hawkish SNB to keep USD/CHF offered, targeting May's 0.8820 low – ING

The Swiss National Bank (SNB) meets to set rates today. Economists at ING analyze CHF's outlook ahead of the decision.

Majority of economists are going for a 25 bps hike

The majority of economists are going for a 25 bps hike, but a sizable minority look for 50 bps. 

Recent SNB rhetoric has remained hawkish despite core inflation dropping below 2% year-on-year. Last September, we estimated that the SNB wanted to engineer 5% nominal appreciation per year to keep the real CHF stable. That is roughly what has happened. Where we were wrong is that it has come more through USD/CHF than EUR/CHF. 

Expect a hawkish SNB today to keep USD/CHF offered – targeting May's 0.8820 low.

See – SNB Preview: Two scenarios and their implications for EUR/CHF – Credit Suisse