Two classic safe havens just caught a big bid

Gold and the Swiss franc surge

Gold and CHF are two of the classic safe harbors in times of turmoil.

Gold began to rally just before the CPI numbers were released and has continued higher in the aftermath. If the Fed were to stay on the sidelines and not offer anything particularly hawkish, it will be one of the biggest beneficiaries tomorrow.

The Swiss franc is much more complicated. The SNB decision is tomorrow 10-and-a-half hours before the Fed. With Switzerland in a battle against deflation there is talk they could do more. On the flipside, EUR/CHF has been in a nice uptrend and traders may be squaring up. That would also help to explain the bid in the euro.

The takeaway

The gold and Swiss franc bids might not be related. We're a day away from two important central bank decisions and position squaring and flows are the main drivers today.