Is the SNB learning to live with a stronger franc?

While we suspect that the SNB has intervened to slow the rise of the franc in recent weeks, it has not prevented it from reaching a multi-year high against the euro. At the margin, an increased tolerance for a stronger currency argues against the Bank cutting interest rates even further into negative territory. But if the ECB loosens policy later this year, as we expect, we still think that the SNB would follow suit.