SNB said to significant overvaluation of the CHF has been reduced

SNB statement with the policy decision to leave rates d’14 sep

  • Swiss Franc is still very appreciated
  • the situation on the foreign exchange markets still fragile
  • The SNB will remain active in the foreign exchange market
  • negative interest rate, the willingness to intervene in the FX remain essential to reduce the attractiveness of swiss franc investments
  • will continue to monitor the situation in the mortgage and property markets
  • regularly assess the CWB
  • the imbalances on the mortgage loans, the real estate markets persist

A small nod to the fact that the EURCHF has gathered more than a period of time, thanks in large part to their smoothness, but also a ower of the application.

USDCHF, however, is a different kettle of fish, and their prudence, and the position remains intact.

Said the SNB:

Since the last monetary policy assessment, the Swiss franc weakened against the euro and
appreciated against the dollar. All in all, this evolution contributes to reduce, to a certain extent,
the important overvaluation of the currency. The Swiss franc is still very
evaluated, and the situation on the foreign exchange market is still fragile. The negative interest
the rate of the SNB, of the willingness to intervene on the foreign exchange market as necessary
thus remain essential in order to reduce the attractiveness of investments in swiss francs and
thus relieve the pressure on the currency.

Because of the exchange rate situation, the conditional inflation forecast has been revised
up slightly compared to June. For the current year, the forecast has increased marginally
to 0.4%, from 0.3% in the previous quarter. For 2018, also, the national bank expects an inflation
rate of 0.4%, compared to 0.3% last quarter. For 2019, it now expects inflation of 1.1%,
compared to 1.0% in the previous quarter. The conditional inflation forecast is based on the assumption
the unchanged three-month Libor to -0.75% over the entire forecast horizon.

Full of the SNB report here

USDCHF 0.9638 and EURCHF 1.1462 at the time a little more gentle, but sufficiently unfazed by it all.

SNB not to take their foot off the gas anytime soon.

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