They will pay any price for Swiss francs, apparently.
EUR/CHF is at a fresh all-time low of 1.2585. Sovereign debt jitters in Europe are clearly playing a part but no doubt holders of CHF-denominated mortgages are no doubt playing a part.
I really feel for the folks in central Europe who borrowed “cheaply” in francs only to see the currency rocket higher, turning that cheap loan into a catastrophe…
In thin, year-end markets there is no telling how far the franc can go if the market gets one-sided.
Central banks will sometimes enter a market to provide liquidity when there is none. Perhaps the SNB could play that role, but don’t expect them to chase EUR/CHF up, and don’t expect a big, expensive intervention. Maybe a few bids to steady the market, if that…
