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’The currency pair league table
$/€ races ahead of $/£, $/¥ and $/SFr, but $/AUD has made a strong run from behind…
Actually, the thing that jumps out from Table 4 of the most recent FX trading survey from London’s Foreign Exchange Joint Standing Committee is that none of the columns — April 2011 thru October 2011 — are ranked consecutively.
SNB’s Hildebrand resigns
Breaking via Bloomberg flashes on Monday:
*SNB CHAIRMAN PHILIPP HILDEBRAND RESIGNS
And via Reuters:
BERNE, Jan 9 (Reuters) – Swiss National Bank Chairman Philipp Hildebrand is resigning with immediate effect after a scandal over a controversial currency trade made by his wife,
Es war meine Frau!
Presenting the main snippets from SNB chief Philipp Hildebrand’s Thursday afternoon press conference, which was organised to explain Frau-X gate to the Swiss public. (via Reuters):
RTRS – SNB CHIEF SAYS QUITE CLEAR THAT MY WIFE ORDERED THE TRANSACTIONS
RTRS – SNB BANK COUNCIL PRESIDENT SAYS WILL LOOK AT INTERNAL RULES,
The SNB presents…
… a monetary extravaganza.
(Nota bene. Figures till end of August — i.e. before intervention)
They’re interesting charts to consider anyway — and analysed by the FT’s James Mackintosh here — although it’s also intriguing to see how markets have treated the Swiss franc on a day like Thursday,
Silent SNB hypnosis
As rumours swirl in the market of a Swiss National Bank press conference later on Tuesday (the SNB said it had no comment)…
… Deutsche Bank’s Alan Ruskin chimes in with some advice for Philipp Hildebrand:
SNB: There is no inflation risk!
You may have stumbled across this Bloomberg story on Wednesday:
Swiss 1970s Inflation Specter Seen in SNB’s Unlimited Sales
Swiss central bank President Philipp Hildebrand’s pledge to protect the economy with unlimited currency purchases may come at a higher cost than billions of francs:
What will Switzerland do with all those euros?
While the scale of Switzerland’s forex intervention on Tuesday caught many people off guard, what’s also caused a bit of bother is seemingly the interpretation of the move.
A key observation, for example,
Swiss real estate will become the new gold
Here’s an interesting view on the consequences of the SNB’s move from Societe Generale’s Sebastien Galy.
First of all, as others have noted too, Galy believes the decision to defend a 1.20 level floor against the euro is credible this time,
SNB euroquake, the analysts react – part two
… continuing the SNB euroquake analyst reaction, RBC’s FX strategy team has an interesting idea: they think the SNB might go as far as buying Spanish and Italian debt, in a bid to find a return for its intervention-related euro cashpile:
SNB euroquake, the analyst reaction – part one
The SNB has come out all guns blazing on Tuesday in a bid to weaken the Swiss franc.
And it’s the use of some key expressions that really stands out. Among them, “acute threat”, “no longer tolerate”
The clairvoyant Jim O’Neill
Full marks to Goldman’s Jim O’Neill who over the weekend called the SNB’s decision to set a direct policy target for the Swissy.
(Emphasis ours):
The Swiss authorities face a huge challenge. If they are serious about trying to prevent the devastating damage that could result from the Franc’s strength,
A Swiss “sigma” event
Or, turning the leveraged into fondue. Hat-tip to Scott Barber of Reuters graphics:
Related link:
European Central Bank response – ECB
The Swiss National Bank is pegging it
“prepared to buy foreign currency in unlimited quantities…”
Carried away in Switzerland [updated]
Negative rates have arrived! In Switzerland, anyway.
Which means the risk of the Swiss franc becoming a funding currency for carry trade — à la the Japanese yen — is very real.
That said, volatility is still the issue.
Robin Hood meets William Tell
This should make Davos a bit less tense; a win-win for the British and Swiss governments on Wednesday:
Aug 24 (Reuters) – Switzerland and Britain struck a deal on Wednesday to tax money kept by British residents in secret Swiss bank accounts,
FX swap lines to the rescue?
Some believe that of all the emergency facilities initiated by global central banks in 2008 the most helpful was in fact the introduction of unlimited FX swap lines.
As the Bank of International Settlements wrote in May 2010:
SNB declines to show its pegleg
But it is firing up the printing presses again.
Initial market reaction.
SNB shows some pegleg
SNB: “Leave our dear Swissie alone. Seriously, leave it alone.”
Investors: ”But we don’t know where else to hide.”
SNB: “Right then, you’ll have to pay for it.”
Investors: “How much have you got?”
[Competition] A Swiss CPI basket
Consumer prices are on everybody’s mind in Switzerland.
World Radio Switzerland (the English-speaking Swiss network) kicked things of this morning with a debate about why on earth prices in Switzerland are refusing to budge lower,
Swiss rates go negative
Looks like le plan, negatifs taux d’intérêt is being tested.
Nice spot on Wednesday by Citigroup’s Michael Saunders:
Swiss 3-month rate futures today have rallied beyond 100.0 (the September contract is at 100.08),
Why is Socgen offering 12-month gold for less than spot? Or is it a typo?
[ATTENTION - It is very possible the data in the Reuters chart could be wrong]
Something is afoot at the French banks.
At pixel time Societe Generale was trading 11.5 per cent lower:
BNP Paribas was off 7.5 per cent:
Nobody messes with the SNB
Tuesday’s FOMC decision to extend a low rate environment until at least 2013 caused both the euro and the dollar to weaken quickly and significantly against the Swiss franc.
Never to be upstaged, the Swiss National Bank has now come out with its own counter-appreciation move for the Swiss franc.
Yields at record lows and it’s EURUSD vs CHF
Looks like QE2.0 is going down a treat in the FX and bond markets.
First, 3-year, 5-year, and 10-year charts.
Nice little price bump here for those buying 3-years at the first post-downgrade auction.
Oh Schweizer!
In the aftermath of Wednesday’s unexpected rate cut and liquidity measures from the SNB — all designed to weaken the Swiss franc – there was only one thought on many people’s minds.
Was this indeed the top for the Swiss franc? And if so,
Le plan, negatifs taux d’intérêt – redux
Oh dear.
The ‘psychological shock’ of Wednesday’s moves by the Swiss National Bank to stem the rapid rise of the franc is already wearing off — at least in the FX market.
Frankly, that’s no surprise.
Le plan, negatifs taux d’intérêt
On Wednesday, the SNB unleashed it’s ultimate Swiss franc depreciation plan — le plan, negatifs taux d’intérêt — a.k.a the strongest signal yet that it is prepared to take interest rates negative to curb Swiss franc strength.
The SNB can change your franc in seven days!
Look into our eyes. Not around the eyes. Deep, deep, deep into our eyes. You feel you’re getting sleepy. You feel safe and complete. You do not want to hold the franc any longer. You think the franc is rubbish.
Swiss bank avalanche
This might be a deferred sell-off following Monday’s holiday in Switzerland. In the words of one analyst though, they’re ‘stuck between a soft dollar and a hard franc…’
(That’s because the wealth management arms of both banks have mainly US dollar revenues and Swiss franc costs).
The Swiss franc’s safe-haven status, a visual interpretation
The Swiss franc is on the rise against the euro and the dollar again on Wednesday thanks, as multiple market reports state, to its safe-haven status.
In fact, the currency was last quoted at about 1.158 versus the euro and 0.7996 against the dollar.
What’s as good as gold, but potentially much more volatile?
The Swiss franc.
It has indeed often been cited as being as good as gold.
But while, on the surface, its similarities with the yellow metal might seem obvious, there is one very important difference to bear in mind.