Swiss National Bank fires a warning shot

Swiss National Bank fires a warning shot as they started with forex purchases once again. This was probably a reaction to CHF pushing to two-year maximum against EUR. According to Monday data from Swiss National Bank, their sight deposits rose dramatically by 1,7 billion Swiss francs last week.

Last week data confirm that mentioned increase in sight deposits was the biggest since 2Q of 2017. There can be no doubt that Swiss National Bank is active on markets. Current situation strongly suggests that Swiss National Bank was active in buying foreign currencies again to offset the pressure to strengthen the currency. 

 Chairman of the Swiss National Bank Thomas Jordan commented that they can continue with purchases of foreign currencies and policy of low interest rates to prevent further strengthening of franc. Such policy can be expected in following weeks. Especially after potential interest rates cut by ECB in September.

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