The SNB does not seem to be losing much sleep about the strength of the franc against the euro, despite the currency’s brief foray past parity earlier this week. The truth of the matter is that euro-zone policymakers currently hold the whip hand for movements in the currency pair, and to the extent that the ECB will tolerate a moderately weaker euro, the SNB has little choice but to learn to live with a stronger franc. The main data release next week is Swedish inflation for February, which we expect to show that core inflation rose to its fastest rate since December 1993 (+3.0%).
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