EURUSD may have resisted a drop below parity for now as USD gave back some gains but outlook for euro remains bleak. Common currency is eyeing a break to a new record low against Swiss franc. EURCHF reached 0.9800 level today, which is more or less where the pair settled on January 19, 2015, when Swiss National Bank announced that it will no longer defend 1.20 area. However, current levels are still way above intraday lows from 2015 when EURCHF traded as low as 0.84 on the interbank market. The move was of course exaggerated by liquidity issues and the pair returned above 1.00 shortly after.
While both ECB and SNB are considered very dovish central banks, the Swiss central bank has already begun hiking rates with the intention of exiting a negative rates regime. Meanwhile, the ECB is yet to deliver its first rate hike. Unless the ECB boosts its efforts to normalize policy, EURCHF may be set for a move to fresh record lows.
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EURCHF tested 0.9800 level - an area where the pair finished trading on the so-called "Black Thursday" in January 2015. Source: xStation5
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