ECB QE extension unlikely to cause material EUR/CHF depreciation

If the ECB extends the time horizon of its QE, great pressure is not likely on the EUR/CHF bilateral, as narrowing EA-CHF swap rate differentials would likely come back to their July levels, when the CHF faced strong inflows due to 'Grexit' risks. 

Further, CHF rates are expected to fall as well, as markets would expect the SNB's negative nominal rates policy to be retained longer in tandem with ECB policy. As a result, the SNB is likely to adopt a 'wait-and-see policy,' rather than respond with immediate action to an extension of the ECB's commitment to QE. 

"If EUR/CHF begins to reverse its trend of appreciation, the SNB might cut its deposit rate further. If, however, EUR/CHF is stable or continues to appreciate, no further action is expected from the SNB", says Barclays.