Yesterday’s announcement by the Swiss National Bank that it would seek to maintain the currency at 1.20 Swiss francs to the euro resulted in a decline of more than 8 percent for the franc. In recent months, the Swiss currency has been in great demand as a “safe haven” resulting in an appreciation in the franc’s value that ultimately forced the central bank to intervene in an attempt to protect export sales.
“We will see a lot more intervention now, we will see manipulation on a grand scale,†said Stuart Thomson, at Ignis Asset Management in Glasgow. “Traditional safe havens are trying to undermine the value of their currencies.â€
Source: Bloomberg
