FX trade of the week
The dollar is off to a strong start this week and two banks see more to come.
Citi says to buy USD/CHF this week (spot at 1.0101).
“We would point out that recently Swiss rates have turned more
negative, leading to our bearish view on the currency. Investors are
becoming increasingly concerned what ECB policy expansion will mean for the SNB.
1w and 1m USDCHF risk-reversals are increasingly less bid for puts, highlighting
a turn in sentiment in vol space as well.