UBS revised its outlook on the Swiss franc, adjusting the currency's position from “least favourable” to “neutral”. This reassessment comes amid expectations that the US dollar will maintain its strength, with the possibility of intermittent increases in value.
However, UBS does not expect a sharp rise or significant decline in the value of the dollar when the Fed begins its interest rate cutting cycle, which is expected to begin in September.
UBS forecasts indicate that geopolitical uncertainty, especially that related to the Middle East, is likely to persist. The company notes that unless there is a rise in oil prices due to actual supply disruptions, these geopolitical factors should not lead to a significant increase in market risk aversion.
The company continues to encourage investment in currency pairs, which involves trading between two currencies, excluding the US dollar. UBS's adjustment to the position of the Swiss franc signals a change in the perceived risk and potential return of holding or trading the currency.
The revaluation of the Swiss franc by UBS reflects a broader analysis of the currency's market situation. Previously considered a less favorable option, the new “neutral” rating for the Swiss franc suggests that the risks associated with short positions in the currency may have diminished.
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