The Swiss franc slid against the US dollar and the euro today after the comments of the central bank’s chief, who complained about the strength of the currency and said that the central bank may intervene to bring the exchange rate down.
Thomas Jordan, Chairman of the Governing Board of the Swiss National Bank, said today the troubles of the global economy and the resulting European debt crisis attracted speculators to the safety of the franc:
The current strength of the Swiss franc is a reflection of this global crisis, and highlights the franc’s status as a safe haven, which is especially pronounced in times of high global uncertainty.
He was unhappy with this turn of events and stated:
Overall, the Swiss franc is currently significantly overvalued. Monetary policy is geared towards this challenging set of circumstances, and is guided by the SNB’s willingness to take an active role in the foreign exchange market and apply negative interest rates.
The Swissie dived immediately after the comments.
USD/CHF climbed from 0.9335 to 0.9411 as of 11:09 GMT today. EUR/CHF advanced from 1.0461 to 1.0544.
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