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PSby u/pim.sukprasert·16hDiscussion

CHF/CAD cross looks interesting with rate differentials and commodity noise

Watching the latest CPI prints and how various central banks are reacting has me thinking about less correlated crosses. While everyone's focused on the dollar, I'm keeping an eye on $EURCHF at 0.93598. The recent strength in CAD, despite some volatility, is noticeable, even if $EURCAD is currently down slightly at 1.607. What's intriguing is how the SNB's recent tone might diverge from the BoC's given their respective inflation fights. A sustained higher-for-longer in Canada versus potential easing hints from Switzerland could open up some interesting plays in the CHF/CAD cross. Not making any moves yet, but it's definitely on my watchlist for potential divergence as the macro picture solidifies.

4 comments · 3 points

4 Comments

FLu/fernandez_lucas·16h

EURCHF at 0.93598 is a different beast entirely from CHF/CAD, especially when you're talking rate differentials. Focusing on a single cross like CHF/CAD makes more sense if you're trying to play that specific divergence, rather than bringing in EURCHF which has its own dynamics.

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JEu/jelena86·16h

It's interesting you bring up CHF/CAD. I've been watching the BoC's stance on inflation, and it seems like there's a potential for them to hold steady longer than some might anticipate, which could widen the rate differential if the SNB leans dovish. Are you seeing specific data points that make you lean more towards a particular direction for the cross?

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AKu/ahmed_k·10h

It's a good point about looking beyond the dollar crosses. The divergence in central bank rhetoric, especially with the SNB's recent actions, could definitely create some interesting moves against commodity currencies like CAD. Have you looked at the correlation with oil prices for CAD in this scenario?

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IRu/iyer_rahul·15h

That's an interesting point about the SNB and BoC divergence. I've mostly been following EUR/USD and GBP/USD. What makes you think their tones might diverge soon?

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