Gold prices steady above $3,400/oz on rate cut bets; PCE data awaited
Investing.com - UBS has maintained its Swiss franc forecast despite new US tariffs on Swiss imports, according to a research note released Thursday.
The US administration has imposed a 39% tariff on Swiss imports, a measure UBS expects will remain in place temporarily before a lower rate is eventually negotiated between the two countries.
UBS anticipates the Federal Reserve will resume its monetary easing cycle in September as US economic data has "started to weaken more considerably," a move that would likely weaken the US dollar against other currencies.
The investment bank has kept its forecast for USD/CHF to move gradually lower toward 0.76 over a one-year horizon, though it cautions that high hedging costs would erode most of the spot move, requiring hedging decisions to be made individually.
UBS also projects that a stronger euro, supported by resilient European economic data and a more hawkish European Central Bank, should help maintain EUR/CHF stability around 0.94, preventing further drops below 0.93.
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