SNB & CHF

The bank said it was willing to intervene in the foreign exchange market “as necessary” to mitigate upward pressure on the franc. Keystone / Peter Klaunzer The Swiss National Bank has decided to stick to its expansionary monetary policy, a day after the US Federal Reserve announced it was tightening monetary policies amid rising inflation. On Thursday, the SNB announcedExternal link it was keeping the monetary policy rate at -0.75%. In doing so the bank wrote in a...

The SNB is maintaining its expansionary monetary policy. It is thus ensuring price stability and supporting the Swiss economy in its recovery from the impact of the coronavirus pandemic. It is keeping the SNB policy rate and interest on sight deposits at the SNB at −0.75%, and remains willing to intervene in the foreign exchange market as necessary, in order to counter upward pressure on the Swiss franc. In so doing, it takes the overall currency situation into...

Throughout much of the past century, the idea of a gold standard for national currencies has been routinely linked with laissez-faire economics and “classical liberalism”—also known as “libertarianism.” It’s not difficult to see why. During the second half of the nineteenth century—as free-market liberalism was especially influential in much of Western Europe—it was the liberals who pushed for the adoption of the system we now know as the classical gold standard...

One quick note on yesterday’s retail sales estimates in the US for the month of November 2021. The increase for them was less than had been expected, but these were hardly awful by any rational measure. Instead, they seemed to further indicate only what we had proposed upon release of the October estimates: Christmas shopping came a bit early for more shoppers than otherwise. Not terribly dramatic by any means, yet noticeable. Even the “real” series adjusted for,...

I have always had a bad attitude toward official secrets regardless of who is keeping them. That prejudice and John Kenneth Galbraith are to blame for an unauthorized withdrawal I made from the World Bank. When I lived in Boston in the late 1970s, I paid $25 to attend a series of lectures by Galbraith on foreign aid and other topics. The louder Galbraith praised foreign aid, the warier I became. His hokum spurred my reading and led me to recognize that foreign aid is...

Overview:  The Fed's hawkish pivot came a few weeks before yesterday's FOMC meeting, which confirmed more or less what the market had already largely anticipated. Buy the (dollar) on rumors (of tapering and more aggressive stance on rates) and sell the fact unfolded, and unleashed the risk-appetites which rippled through the capital markets. US stocks rallied yesterday, and the futures point to a gap higher opening today. Large Asia Pacific bourses, led by a 2%...

A view of the Alps inside the Swiss pavilion at Expo 2020 Dubai. Www.sebastiencrettaz.com The Swiss pavilion at the ongoing Universal Exposition in Dubai leads the visitor through Alpine landscapes in a show of light and shadows to showcase Swiss sustainability, urbanisation and innovation. It is a concept that seems to appeal to the public, despite the pandemic and the many contradictions that characterise the Gulf region. With an investment of CHF16.5 million...

I never thought I would find myself saying this but President Biden has just instituted a great boycott. It’s against China, which U.S. officials have been trying their best to reconvert into a Cold War enemy, opponent, rival, or adversary.  What’s so good about this boycott? It purports to punish China by prohibiting U.S. government officials from attending the Winter Olympics in China.  That’s a punishment? Are you kidding? What greater thing could befall China...

BBVA Switzerland, the Swiss franchise of Spanish multinational financial institution BBVA, has expanded its cryptocurrency custody and trading service with the addition of Ether to its investment portfolio. Its private banking clients and new gen customers will now have access to both Bitcoin and Ether, a statement from the company said. These digital assets can be viewed along with other traditional investments on BBVA’s app, and can automatically be converted to...

The Fed delivered what it was expected to do:  double the pace of tapering and project a more aggressive interest rate response with its individual forecasts.  The dollar initially rallied on the headlines, and new sessions highs were recorded, but the price action was a bit of a head-fake, as it were. The greenback's gains were quickly pared,  though it remained above JPY114 ahead of Chair Powell's press conference. The market had already discounted two hikes and...