The Swiss franc rose today after the central bank left its monetary policy unchanged, keeping the cap on the currency intact, but refraining from any unconventional measures to spur growth.
The Swiss National Bank left its interest rates near zero and the franc’s ceiling at 1.20 per euro. Chairman Thomas Jordan explained the necessity of the cap at the press conference after the announcement:
An appreciation of the Swiss franc would compromise price stability and would have serious consequences for the Swiss economy. In the current environment, the minimum exchange rate remains important in order to avoid an undesirable tightening of monetary conditions for Switzerland in the event of sudden upward pressure on the Swiss franc. We stand ready to enforce the minimum exchange rate, if necessary, by buying foreign currency in unlimited quantities, and to take further measures, as required.
He also said that “the Swiss franc is still high” and “the risks for the Swiss economy remain high”.
The decision did not surprise market analysts, who have predicted no change to the policy.
USD/CHF was at about 0.9271 as of 21:13 GMT today after rising from 0.9276 to 0.9359. EUR/CHF tumbled from 1.2336 to 1.2257. CHF/JPY rose from 103.84 to 104.86 and its daily high was at 105.70.
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