To position for a Brexit deal; Buy GBP/CHF targeting 1.25 – Credit Agricole

Credit Agricole CIB Research likes long GBP/CHF exposure on the prospect of a Brexit EU-UK trade deal targeting a move towards 1.25.

“Our central case remains that a ‘bare -bones’ Free Trade Agreement (FTA) will be agreed between the UK and the EU. We continue to think that a trade deal is in the best interest of both the EU and the UK,” CACIB notes. 

“Subsequently, we think that there is a non -negligible risk that the
UK and the EU will agree to a partial trade deal, focusing on the
topics where the two sides can compromise. To the extent that this
outcome nevertheless gives the Brexit saga a sense of finality, even
a partial Brexit deal could propel the GBP higher across the board and
especially vs overvalued and low -yielding currencies like the CHF,” CACIB adds.

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