Swiss Franc May Replace Yen in Carry Trades Amid Intervention Risk

Investors may be shifting their carry trades from the yen to the Swiss franc following a rare currency intervention by the U.S. and Japan to support the yen.

This could lead to the weakening of the franc, potentially providing relief to Swiss exporters and the Swiss National Bank.

The Swiss franc has been about 12% stronger against the euro than it was five years ago, but recent weakening has brought it close to its weakest level in about a year.

According to Rabobank, the euro/franc pair could weaken further, with a target forecast of 0.95 francs per euro within nine to twelve months.