Why Switzerland’s Franc Is Still Strong in Four Charts
- SNB’s negative rate intended to reduce franc’s appeal
- Swiss central bankers says franc remains ‘overvalued’
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Swiss National Bank President Thomas Jordan keeps saying the franc is “significantly overvalued.” And that’s despite the central bank’s record-low deposit rate and occasional currency market interventions.
While the franc is typically a top choice for foreign investors looking for a safe place to park their money, anxieties about the euro area’s debt burden or Brexit aren’t the only factor. The residents of Switzerland -- which has a sizable current-account surplus despite its strong currency -- are partly to blame because they aren’t moving money abroad, which could help them achieve higher returns.