During February the Swiss franc strengthened versus the euro from 1.0420 to 1.0324. The invasion of Ukraine by Russia has altered the near-term risks and upward pressure on the Swiss franc is likely to persist over the short-term, in the view of economists at MUFG Bank.
CHF weaker trend can’t emerge with geopolitical risks so high
“The strong retaliatory sanctions by NATO allies are unlikely to alter the plans of Russia and hence the risks associated with this conflict could well persist over the coming weeks and possibly months. That scenario means we have raised our CHF strength profile and see EUR/CHF testing parity.”
“A more pronounced escalation in the conflict, by say drawing in NATO into a conflict cannot be ruled out and would no doubt result in EUR/CHF probably breaching the parity level.”