Forex Blog

August 3, 2011

SNB Surprise Rate Cut!

The Swiss National Bank (SNB), tired of recent Swiss franc strength dut to safe-haven demand popped a surprise rate cut on the markets in an attempt to weaken the franc as discourage speculators from buying.  This is essentially a “warning shot”, trying to send the message that the SNB will intervene further if necessary.

It seems likely that it will be necessary, as Dollar weakness, a declining global economy, and the continued Euro debt crisis all make the franc desirable as a safe-haven regardless of the interest rate.

So keep an eye on the Swissie, as the SNB has intervened in the past and may continue to do so.

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