Swiss franc climbs again
THE SWISS franc climbed yesterday and could hit record highs against the dollar and euro in days ahead if new measures by the Swiss National Bank fail to slow the currency’s rise.
While the SNB announced an expansion of its liquidity policy, investors who bet on more aggressive action were disappointed that the plan did not include pegging the franc exchange rate to the euro or dollar.
The Swiss franc strengthened even after the SNB statement, in which it also reiterated that it would take additional steps if needed.
Investors may continue to plough into the Swiss franc, with the Swiss two-year swap spread actually touching negative territory yesterday.
The euro had earlier tumbled more than two per cent against the franc in volatile trade to hit a low of 1.12248 francs, although losses were later pared and it was last at 1.1392 francs, down 0.7 per cent. “If Eurozone investors want to buy the Swiss franc because they don’t feel safe, there’s nothing the Swiss can do about it,” commented Greg Anderson of CitiFX.