Swiss franc strengthens against dollar, but SNB unlikely to intervene

The Swiss franc continues to get stronger against the dollar. Keystone-SDA

The Swiss franc continues to get stronger against the dollar, with a new high reported on Tuesday. But the Swiss National Bank (SNB) is unlikely to intervene, according to a financial expert.

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On Tuesday afternoon, one US dollar fell to CHF0.7701, its lowest level ever, excluding the price turbulence related to the scrapping of the minimum exchange rate with the euro on in January 2015. The Swiss currency also strengthened against the euro, which hit a low of CHF0.9189, its lowest level since last November.

However, the SNB has not made any countermove in the market, a Valiant analyst said. This is in line with signs that the central bank is worried not so much by the absolute level of exchange rates but rather by strong fluctuations.

“However, the current pressure is coming more from the dollar, where volatility is higher,” the analyst said. An easing of tension on this front would also lead to a relaxation with regard to the euro.

This week the markets’ focus is on the US Federal Reserve, which starts its two-day monetary policy meeting on Tuesday.

Observers do not expect a rate cut. However, the meeting could provide new impetus, as the first hints or even an announcement on the future appointment of the central bank Chair could emerge.

The term of office of the current Chair Jerome Powell, who is under heavy pressure from President Donald Trump, will end in May.

Adapted from Italian by AI/sb

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