The Swiss franc dropped against the US dollar and the Japanese yen today after Switzerland’s central bank maintained its extremely accommodative policy and the cap on the currency. The Swissie was virtually flat against the euro.
The Swiss National Bank maintained interest rates near zero and the ceiling on the franc at 1.20 per euro. The central bank reiterated the pledge to limit franc’s gains versus the euro as long as it is necessary. The SNB mentioned that “there are still substantial risks attached to the global economic recovery”. As for the domestic economy, the bank explained that “the fourth quarter of 2013 saw a weakening of growth momentum”.
The ZEW/Credit Suisse Economic Expectations indicator sank 9.7 to 19.0 in March. The report confirmed that the outlook for the Swiss economy is worsening, making the Swissie less safe and, as a result, reducing its value as a refuge currency.
USD/CHF was up from 0.8800 to 0.8835 as of 16:29 GMT today, reaching the high of 0.8868 intraday. CHF/JPY slipped from 116.15 to 115.88, and its daily low was at 115.51. EUR/CHF was at 1.2175, near the opening rate of 1.2178.
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