Latest decision by the Swiss National Bank - 14 Dec 2017

  • 3-month Libor lower target range -1.25%
  • 3-month Libor upper target range -0.25%
  • Inflation to rise to 2.1% in Q3 2020
  • Sees 2017 inflation at 0.5%
  • Sees 2018 inflation at 0.7%
  • Sees 2019 inflation at 1.1%
  • Swiss franc overvaluation has continued to decrease, yet the franc remains highly valued
  • Remains active in currency market
  • CHF fall reflects that safe havens are less sought after
  • Willingness to intervene in FX market as needed
  • Expects GDP growth of 2% in 2018
  • Recovery in Swiss economy looks set to continue
  • Inflation forecast for coming quarters is higher, due to higher oil prices and CHF weakening
  • Renewed appreciation of CHF will be a threat to price and economic developments

Full statement here.

USD/CHF fell a little on the decision but then is back up to 0.9863. Meanwhile, EUR/CHF touched session highs of 1.1677.

No surprises by the SNB this time around, reiterating the "highly valued" CHF and expressing their interest to intervene in the market if the CHF strengthens.

I believe the SNB will not make a move to tighten so long as the ECB is on that path, they'd leave things as it is until the CHF weakens further against the EUR before changing their stance. For the SNB, the monetary policy divergence is helping them do their job instead - so there's no need to change that.