Forex - Swiss franc slips as Swiss National Bank holds rates By South CCAA Investments/Forex News The Swiss franc slipped lower against the euro and the broadly stronger dollar on Thursday after the Swiss National Bank left rates on hold and said it was maintaining its exchange rate floor against the euro. Forex - Swiss franc slips as Swiss National Bank holds ratesSwiss franc slips after SNB announcment EUR/CHF edged up 0.10% to 1.2196, from session lows of 1.2177 ahead of the announcement. The euro moved higher after the SNB reiterated it would enforce the 1.20 per euro minimum exchange rate floor with unlimited interventions if necessary, and added that it remained ready to take further measures. The SNB put the exchange rate cap in place in September 2011 after the franc almost reached parity with the euro, amid concerns over the impact of a strong franc on the Swiss economy, and in particular on exports. The central bank also kept its benchmark interest rate unchanged at 0.0% to 0.25%, in line with forecasts. The SNB confirmed its forecast that the Swiss economy will grow by around 2.0% in 2014. It revised down its inflation forecast, saying consumer prices will remain flat this year and rise 0.4% in 2015. USD/CHF rose 0.15% to 0.8822, close to the two-week highs of 0.8828 reached on Wednesday. The dollar strengthened against the other major currencies on Wednesday after the Federal Reserve indicated that rates could rise as soon as next year. At the conclusion of its two-day policy setting meeting on Wednesday, the Fed said it would reduce its monthly bond purchases by an additional $10 billion to $55 billion. The dollar rallied after Fed Chair Janet Yellen indicated that the bank could begin to raise interest rates about six months after the bond-buying program winds up, which is expected to happen this fall. The Fed statement also emphasized that economic conditions could mean that rates would remain on hold at record lows for some time, even after inflation and employment return to their longer-run trends. The central bank also updated its forward guidance, discarding the 6.5% unemployment threshold for considering when to increase borrowing costs and said it will look at a wide range of information
Posted on: Thu, 20 Mar 2014 09:10:06 +0000
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