Goldman Sachs and Bank of America Merrill Lynch recommend going long on the Swiss franc against the Japanese yen as political risks in Japan escalate.

Strategists at Goldman Sachs and Bank of America suggest going long on the Swiss franc against the Japanese yen, as increasing uncertainty in Japanese politics weakens the yen's attractiveness as a safe haven asset. Shusuke Yamada, Chief Foreign Exchange and Interest Rate strategist at Bank of America, reported that given the strong fiscal position of the Swiss franc and increasing risk premiums for the US dollar and the yen, going long on the Swiss franc against the yen may be the trade that best reflects yen fiscal risks. The bank advises going long on the Swiss franc against the yen with a target of 189. Strategists at Goldman Sachs, including Michael Cahill, also expressed similar views, stating that the new political uncertainty in Japan should support the Swiss franc and to a lesser extent the Euro, both of which will benefit from concerns about US economic growth and subsequent Fed rate cuts.