Swiss Franc
The Mark, the Euro, the Dollar and the Yen: Now and Then
February 12, 2010
Risk aversion has the dollar grinding higher, but I’d like to focus this week’s Foreign Exchange Insights essay on the longer term prognosis. During the first 25 years of flexible exchange rates, the mark, yen and Swissy were called “hard currencies” because conservative monetary and fiscal policies in Germany, Japan and Switzerland promoted low inflation, strong [...] More
Weekly Foreign Exchange Insights: Yearend Edition
December 30, 2009
The dollar is winding up 2009 on a bid note. Except in the unlikely event of a major decline on the final trading day of the year, this will be only the second time in the past eight years in which the U.S. currency rose against the euro between mid-December and yearend. The greenback’s firm [...] More
Quiet Start to Pre-Xmas Week
December 21, 2009
Trading volume has been restrained by snow storm in Eastern U.S. and approaching yearend holidays. Federal snow day in D.C. European weather also severe. The dollar is unchanged against the euro and Swiss franc. The Swissy remains stronger than 1.50 per euro (latest quote = 1.4955) despite released Swiss National Bank quarterly report that reiterates promise [...] More
Swiss National Bank Turns Off Quantitative Measure
December 10, 2009
After releasing a similar assessment of the Swiss economy to it prior review in September, the Swiss National Bank left its target interest rate on three-month Libor unchanged but discontinued its purchases of Swiss franc-denominated bonds issued by private-sector borrowers, a measure that was introduced nine months ago. Monetary officials also reaffirmed their determination not [...] More
Swiss National Bank Preview
December 9, 2009
I expect no meaningful changes in the very accommodative stance, but markets will be reminded that the policy is temporary only. A quarterly Monetary Policy Statement outlining actions for the next three months and new central bank forecasts will be released Thursday. Swiss National Bank policymakers forcefully relaxed monetary conditions last March, cutting their target range [...] More
No Changes in Short-Term Swiss Monetary Policy, But….
September 17, 2009
Swiss officials released a balanced quarterly Monetary Policy Assessment, opting for a cautious approach that 1) holds but does not increase the current expansionary monetary policy stance but also serves notice that this stance “cannot be maintained for the next three years” without compromising long-term price stability. The point and range targets on three-month Swiss Libor [...] More
Swiss Monetary Officials Need to Be Taken Very Seriously
June 25, 2009
Policy makers at the Swiss National Bank hold just four policy meetings per year in the middle of the final month of each calendar quarter. In March, the target interest rate (three-month Swiss Libor) was lowered to 0.25%, as far as it can realistically go. But officials felt that doing that alone would not adequately contain [...] More
Swiss National Bank Retains Aggressively Loose Monetary Stance
June 18, 2009
Following a quarterly policy review, SNB officials agreed to continue the easing steps announced in March. The 3-month Libor target range stays at 0-0.75% with a point guideline of 0.25%. Intervention will be continued to prevent further appreciation of the Swiss franc against the euro. Quantitative policy measures are being done to limit capital market risk premia. The [...] More
Euro Cross-Rates
April 14, 2009
Currency market participants use the term “cross rates” to refer to the euro’s rate of exchange against a currency other than the U.S. dollar. Three cross rates that hold special importance are the sterling cross, Swiss franc cross, and yen cross. These three crosses do not move in tandem even though they all now represent [...] More
Weekly Foreign Exchange Insights: April 3rd
April 3, 2009
The past week saw risk aversion recede additionally in global financial markets. Stock markets and bond yields advanced. Gold retreated, and oil stayed above $50 on hopes that a world recovery would indeed emerge. The biggest currency beneficiaries from the blanket of risk aversion that descended last September had been the yen on the unwinding [...] More
