US: Treasury Sec Bessent & Press Sec Leavitt To Brief Reporters Shortly

• Despite EURCHF opening below 0.90, cycle and decade lows at 0.8981 printed last week have remained untested on Monday, and subsequent price action has seen the pair drift higher towards the 0.9050 mark. In terms of technical parameters, 0.8849 is the most notable Fibonacci projection support, while on the upside, the 20-day EMA intersects at 0.9080.
• Asset managers' and non-commercial positioning has been pared a little recently but remains comfortably net short CHF, while leveraged funds' positioning has remained net long marginally since a couple weeks. While in isolation, this means that there would be more room for Franc strength to extend, the recent SNB statement on a higher vigilance to intervene will continue to weigh on CHF performance as the Iran conflict looks set to continue.
• Markets and analysts see a hold at 0.00% at Thursday’s SNB meeting as the probable outcome. Against the backdrop of Swiss inflation printing close to the lower boundary of the SNB’s definition of price stability, focus will be on any signals on the balance of risks around CHF appreciation on the one hand against higher energy prices on the other. Our full preview for the decision will be released tomorrow.

Below are some of the most recently updated analyst views on the CHF:

• Rabobank "retain the view that EUR/CHF will hold close to this level on a 1-to-3-month view, but an extended or widened crisis in the Middle would elevate the risks of a move below 0.90".
• JP Morgan have upgraded their forecasts for the Swiss Franc, as bullish forces of reserve demand, repatriation, BOP and PPP have dominated even at peak carry optimism. JPM now see EURCHF trading at 0.91 in both Q2 and Q4 this year, down from prior forecasts of 0.94.
• ING meanwhile "would see upside risk to EUR/CHF around the central bank meeting. But unless the situation alters substantially in the Gulf, it looks like the SNB will be drawn into a long campaign to support EUR/CHF below 0.90."

The retracement away from session lows in crude leaves gilt yields 4-6bp off session lows ahead of the close, with benchmarks last running 3.5-6.0bp lower on the day.

• Gilt futures +59 at 89.07 vs. session highs of 89.53. Bulls failed to challenge Thursday’s top (89.70). First resistance of note is located at the 20-day EMA (90.98), with bears remaining in technical control at this stage.
• The BoE’s sale of GBP775mln of medium-dated gilts from its APF saw average demand.
• BoE-dated OIS pricing ~17.5bp of tightening through year-end vs. ~25bp late on Friday.
• Cross-market cues will continue to dominate ahead of Thursday’s BoE decision and labour market data.
• We expect the BoE to vote 7-2 in favour of leaving rates unchanged.
• Note that we will provide the usual detailed previews of the labour market data and BoE decision ahead of those events. Until then, see our Global Week Ahead publication for a little more colour on the matters.

• RES 4: 113-07+ High Mar 3 
• RES 3: 113-03   High Mar 4 
• RES 2: 112-12+/112-24+ 20-day EMA / High Mar 10  
• RES 1: 111-13+ High Mar 12
• PRICE:‌‌ 111-23+ @ 16:44 GMT Mar 16
• SUP 1: 111-11   Low Mar 13
• SUP 2: 111-08+ Low Feb 3
• SUP 3: 111-06+ Low Jan 20 and a key support
• SUP 4: 111-00   Round number support 

A bear cycle in Treasuries remains intact and last week’s sell-off, reinforces current bearish conditions. The move down exposes the next key support at 111-06+, the Jan 20 low. Clearance of this level would highlight an important medium-term bearish development. Initial firm resistance is seen at 112-12+, the 20-day EMA. A clear break of it is required to signal a possible reversal. First resistance is 111-31+, the Mar 12 high.