EUR/CHF found support at 1.5050from European accounts after suffering under the weight of broad euro selling pressure. A rise in risk aversion resulted in heavy unwinding of speculative positioning, which overwhelmed EUR/CHF and forced a move lower during Monday’s N.Y. session. USD/CHF maintained its familiar range either side of 1.0900 despite the heavy dollar moves elsewhere, with cross flows distorting interest for the dollar pairing. Overall, interest to buy swissy has been limited ahead of Thursday’s SNB amid fears of more FX intervention. At the last policy meeting in March the SNB intervened in EUR/CHF and they were touted as buyers in mid-May via a supranational name. The SNB are not expected to change its key Libor, but should maintain its commitment to FX intervention when necessary and to continue with its non-standard policy measures, which have included outright bond purchases. Elsewhere, today’s Swiss industry orders revealed more signs of weakness in industrial production ahead after its dropped 17.6% y/y in Q1. Industrial production fell 9.5% y/y in Q1 2009.
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