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Just a few months ago, there was 1.15 francs for one euro. But since then, the currency pair is changing a lot. After the magic mark of 1.10 has already fallen the next.
New week, old photo: the franc continues its high flight Monday morning. Currently, the price rises to 1.0889 Euro / Franconia. For the first time since July 2017, the franc broke the 1.09 barrier. In the spring, it was 1.15 francs for one euro.
Is it even further with the Franken-Höhenflug? Last week, the Cash.ch financial portal cited experts who predicted this. According to two analysts at Bank Julius Baer, key technical support is important at 1.0950 francs. In the event of a downward breach, the authors of the publication "Technical Investment Strategy" would see the euro fall back to 1.06 francs. The mark is now fallen.
SNB under pressure
Raiffeisen Chief Economist Martin Neff (58) also expects the Swiss franc to remain strong, as he said in a statement to SonntagsBlick in July. "Parity comes," according to his prediction. A little patience is needed: "In 18 months, the euro will cost one franc."
When the Swiss franc is on the move, the Swiss National Bank is always at the center of concern. Again this time. "We must not envy the SNB," says Thomas Stucki, DSI of the Cantonal Bank of St. Gallen, in his comment Monday morning. For two years, the SNB has had a relatively calm period. It's over now.
Intervene, for better or for worse
What should the SNB do? "The SNB does not have good options for action," Mr Stucki said. He sees the franc as the best option for market forces and nothing to do. However, only if there is no rapid appreciation of the Swiss franc.
According to Mr Stucki, the worst option would be for the SNB to reduce interest rates to -1%. The effect of reducing rates will evaporate fairly quickly. The SNB should then face the same problem.
According to Mr Stucki, it is highly likely that the SNB will intervene again on the foreign exchange market. And flexible, without defending a certain level of all your strength. Thanks to the interventions, the balance sheet of the National Bank will continue to grow. But it is the least harm compared to the negative consequences of the other options of action. (JFR)
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