CHF/ZAR Outlook:
Bearish, as the rate is below its recent average and near recent lows, but may stabilize without strong catalysts.
Key drivers:
- Rate gap: The Swiss National Bank's potential move towards negative interest rates contrasts with the South African Reserve Bank's commitment to high rates, which supports the rand.
- Risk/commodities: Strong demand for commodities, particularly in gold and platinum, has bolstered the rand as global prices rise substantially.
- Trade Balance Impact: The CHF's strength has hurt Swiss exporters, further complicating the currency's outlook as economic growth is at risk.
Range:
CHF/ZAR is likely to hold within its recent trading levels, bouncing between established lows and highs.
What could change it:
- Upside risk: A shift in global risk appetite towards safe havens could bolster the CHF.
- Downside risk: Continued deterioration of Switzerland's trade balance could pressure the CHF lower against the rand.