German bank: Strong Swiss franc triggers discussion on Swiss National Bank options

Michael Pfister of Deutsche Bank said in a report that the recent strength of the Swiss franc has once again sparked discussions about what options the Swiss National Bank can take to weaken the currency. The analyst stated that the strength of the Swiss franc appears to be driven by weakness in the euro and the US dollar. He mentioned that for an open economy already facing low inflation pressures, the strength of the Swiss franc is a problem. He mentioned that the Swiss National Bank faces difficult choices in this context. Options include strengthening interventions in the foreign exchange market, lowering interest rates into negative territory, or temporarily tolerating the strength of the Swiss franc, but all options have drawbacks. Data from the London Stock Exchange Group shows that the euro rose 0.1% against the Swiss franc to 0.9175 francs, after hitting a historic low of 0.9142 francs last week.