(Bloomberg) — The franc is only slightly overvalued versus the euro and should hit parity with the common currency in the longer term, according to Credit Suisse Group AG.
The haven franc has appreciated sharply since the onset of the financial crisis, depressing growth and inflation. The Swiss National Bank considers the “highly valued.” It’s using a deposit rate of minus 0.75% and a pledge to intervene in force to contain its rise.
Credit Suisse estimates the franc would be fairly valued at 1.24 per euro. That compares with Tuesday’s peak of 1.1174, spurred by investors bracing for more policy easing in the euro area.
“It’s not a question of if parity comes, but when,” said Claude Maurer, an economist at Credit Suisse, citing Switzerland’s low rate of inflation and high trade surplus.
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