Swiss Franc to Hold at 1.52 Per Euro on SNB ‘Caution,’ UBS Says

By Justin Carrigan

Aug. 19 (Bloomberg) -- The Swiss franc is likely to be little changed over the next three months as the central bank seeks to stem its gains, according to UBS AG.

The Swiss National Bank will keep interest rates near zero and continue franc sales to prevent a strengthening of the currency, Handelszeitung cited central bank board member Thomas Jordan as saying in an interview yesterday.

“The deflation risks mean it is still too early for a normalization of monetary policy” from Jordan’s perspective, Brian Kim, a currency strategist at UBS in Stamford, Connecticut, wrote in a report yesterday. The “comments echo the themes and undertone from the SNB’s mid-June assessment and so far the SNB continues to sound comparably cautious.”

The franc was little changed at 1.5202 per euro as of 7:33 a.m. in Zurich. UBS has a one-month and three-month target for the franc of 1.52 per euro.

To contact the reporter on this story: Justin Carrigan in London at jcarrigan@bloomberg.net