The Swiss central bank imposed a ceiling on the franc's exchange rate for the first time in more than three decades and pledged to defend the target with the "utmost determination."
The Swiss National Bank is "aiming for a substantial and sustained weakening of the franc," the Zurich-based bank said in an e-mailed statement today. "With immediate effect, it will no longer tolerate a euro-franc exchange rate below the minimum rate of 1.20 francs" and "is prepared to buy foreign currency in unlimited quantities."
The franc has surged to records against the euro and the dollar, hurting exports and eroding economic growth. While the SNB last month boosted liquidity to the money market and lowered borrowing costs to zero, investor concern that governments may struggle to contain Europe's worsening debt crisis has continued to push the currency higher.
Complete your profile to continue reading and get FREE access to Treasury & Risk, part of your ALM digital membership.
Your access to unlimited Treasury & Risk content isn’t changing.
Once you are an ALM digital member, you’ll receive:
- Critical Treasury & Risk information including in-depth analysis of treasury and finance best practices, case studies with corporate innovators, informative newsletters, educational webcasts and videos, and resources from industry leaders.
- Exclusive discounts on ALM and Treasury & Risk events.
- Access to other award-winning ALM websites including PropertyCasualty360.com and Law.com.
*May exclude premium content
Already have an account? Sign In
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
