Swiss National Bank president Thomas Jordan speaking just now to SRF Radio
- Swiss franc is significantly overvalued, especially vs euro
- SNB does not have an implicit minimum exchange rate, looks at ccy situation as a whole
- minimum exchange rate is not a good instrument to fight a weak euro
- negative rates and readiness to intervene in fx market are best policy at the moment
- keeping currency cap would have done more harm than good
- can't predict duration of negative deposit rates
Jordan repeating recent comments and adding to those he made yesterday which Adam reported here
There is little doubt in my mind that the SNB have been lending a helping hand lately, as I have repeatedly highlighted in my order board posts, evident from the lack of falls in EURCHF and holding above 1.0750 when all around it euro pairs were tumbling.
If, as I believe, we are to see a resurgence in the euro such as that which we saw yesterday after the NFPs, particularly vs the beleaguered pound ( I called for higher EURGBP in my 2016 forecasts) then the SNB's intervention will have a welcome ally.
Jordan's job meanwhile, and as much why he's been very vocal of late, is to convince Swiss exporters suffering from the stronger franc that the SNB did the right thing by removing the CHF cap and that everything will be alright in the end.
This week the SNB reported provisional 2015 losses of CHF 23bln also due to CHF strength with final figures due in March, but 2016 should bring better times for their reserves valuation.
The SNB's work is far from done though and we should expect them to continue prop up both EURCHF and USDCHF for some time yet.