Speculators were quick to buy the Franc into European trading as the impending SNB rate verdict (Thursday 15th) is expected to generate some short-term CHF strength. USD/CHF was tipped as being heavy in the 1.23's and spot was sold back from 1.2345 to 1.2320 bids in the initial European move lower.
Bids trailing back to 1.2310 helped stave off further weakness but the pair remained offered and eventually broke below 1.2300 to trip short-term stop loss orders. These have helped fuel a drop to 1.2274 and bids are now noted into the 1.2255/65 area. Into the North American open and trading is consolidating the sell-off around 1.2280 with US event-risk now seen as the next directional indicator.
In other news, Swiss M&A is in the media spotlight. State-backed telecoms group Swisscom recently launched a EUR 3.7Bln friendly takeover bid for Italian broadband operator Fastweb. British Smith & Nephew plc has agreed to buy Swiss Plus Holdings for an estimated USD 889Mln in cash while on a slightly smaller scale Swiss Sike has acquired MRT.
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