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Pressure returns on Swiss franc amid global uncertainty

August 7, 2019

The Swiss franc has started to appreciate in value against other currencies, including the euro, once again.
One knock-on effect of the escalating trade war between the United States and China is that the Swiss franc is becoming more attractive for investors – putting pressure on the Swiss National Bank (SNB) to come to the defence of the safe haven currency.
For much of July a euro bought at least CHF1.10. But the franc has strengthened this past month, trading at around CHF1.09 against the single currency in the last couple of days.
Several economists, including Janwillem Acket of the Julius Bär bank, believe the markets have been spooked by a ramping up of the China-US trade dispute. On Monday, tensions were

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Swiss mortgages and bank profits rise as jobs scale down

June 29, 2019

The Swiss banking industry continues to turn in a profit despite low interest rates.
Swiss commercial banks achieved higher profits last year, mortgage loans tipped the CHF1 trillion ($1.02 trillion) mark and costs were saved by reducing headcounts. These are the findings of an annual report from the Swiss National bank (SNB).
The SNBexternal link’s “Banks in Switzerlandexternal link” annual report shows combined Swiss and foreign mortgage loans hitting CHF1 trillion in July 2018external link, and the same landmark being breached for purely domestic loans in November. Total mortgages had increased by CHF35.5 billion (or 3.6%) by the end of last year.
The rise was fuelled by people taking advantage of a continuing

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Swiss franc still highly valued, but no policy change

November 7, 2018

Jordan has been chairman of the SNB since 2012.
The Swiss franc, investment in arms, and the housing market were some of the issues the government discussed with the chairman of the Swiss National Bank.
SNB chairman Thomas Jordan told the government that he sees the Swiss currency as highly valued and warned of the continuing risks of bubbles in the housing market.
“Jordan emphasised that monetary policy with negative interest rates and the willingness to intervene [on foreign exchange markets] remains necessary,” according to a government statement published on Wednesday.
In June, Finance Minister Ueli Maurer criticised the bank’s balance sheet, saying its expansion is “on the verge of sustainability”. Commentators

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‘Much too early’ to lift interest rates, says SNB chairman

June 9, 2018

The strong franc is hurting Swiss exporters and the domestic tourism industry
The continued volatility surrounding the Italian elections and the threat of global trade wars make it far too early for the Swiss National Bank (SNB) to consider raising rock bottom interest rates, says chairman Thomas Jordan.
“It’s much too early at this moment,” Jordan told CNNMoney Switzerland. “The situation is still quite fragile regarding [currency] exchange rates. This is the reason that we continue our monetary policy of negative interest rates.”
Most analysts expect the three-month Libor band to remain unchanged at between -1.25% and -0.25% for at least the rest of this year. Jordan’s comments on Friday added further fuel to the

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Swiss median monthly wage exceeds CHF6,500 ($6,506)

May 14, 2018

The survey found that the pay gap between the highest and lowest earners decreased only very slightly in the years between 2008 and 2016,
A government survey analysing wage structures in the Alpine nation found that the median salary for a full-time job in 2016 was CHF6,502 ($6,509) for the entire Swiss economy.
The bottom 10% of Swiss earners had a salary of less than CHF4,313 ($4,317), while the best paid 10% earned more than CHF11,406 ($11,418) a month.
These numbers were published by the Federal Statistical Office (FSO) on Monday.
Stable wage gap
The surveyexternal link also found that the pay gap between the highest and lowest earners decreased only very slightly in the years between 2008 and 2016, from a factor

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Weakening franc approaches symbolic mark

April 20, 2018

The SNB conducts a difficult balancing act to stabilise the national economy.

(Keystone) – Click to enlarge
As the Swiss franc weakens towards the threshold CHF1.20 exchange rate, the likelihood remains slim that Switzerland’s central bank will alter monetary policy any time soon.
On Thursday morning a euro cost CHF1.198 francs. In February, the price of a single euro fell to under CHF1.150. The greater the number of francs needed to buy another currency signals a weaker franc, and vice versa if the exchange rate declines.
The markets are now eyeing the magic CHF1.20 barrier which was the minimum rate defended by Swiss National Bankexternal link (SNB) until it abandoned its policy in January 2015. The Swiss

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Swiss central bank records huge profits after franc slide

March 22, 2018

The Swiss central bank confirmed a record CHF54 billion overall profit in 2017

(Keystone) – Click to enlarge
The Swiss National Bank (SNB) was less active on the foreign exchange markets last year, acquiring CHF48.2 billion ($50.8 billion) in foreign currency to weaken the franc. On Thursday, the central bank nonetheless confirmed massive profits on currency holdings in 2017.
In 2017, the SNB purchased CHF48.2 billion in foreign currency to stop the Swiss franc appreciating – down from CHF67.1 billion in 2016. But the value of the SNB’s foreign currency investments nevertheless rose CHF94 billion to CHF791 billion, which contributed to the central bank’s profit last year.
“[These interventions] occurred mainly

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New CHF200 banknote to be introduced in August

March 19, 2018

The CHF200 note will be unveiled to the public on August 15 and join the new CHF50, CHF20 and CHF10 notes of the same series already in circulation

(Keystone) – Click to enlarge
The Swiss National Bank (SNB) has announced that the latest addition to the new banknote series – the CHF200 note ($209) – will go into circulation on August 22.
The brown note’s key motif will be physical matter. It will “showcase Switzerland’s scientific expertise”, the SNB said a press release on Monday.
The banknote will be unveiled to the public on August 15. The new CHF50, CHF20 and CHF10 notes of the same series are already in circulation. The overall theme is “the many faces of Switzerland” and each note is based on a different

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Swiss National Bank buys paper factory for banknote production

December 27, 2017

To guarantee the smooth roll-out of its new banknote series, the Swiss National Bank (SNB) has bought a struggling paper factory in eastern Switzerland.
The takeover of Landqart AG, valued at CHF21.5 million ($21.7 million), is split between the SNB (90%) and the security printing division of Swiss publisher Orell Füssli (10%).
+ Switzerland is rolling out a new series of banknotes with numerous security features
Landqart makes Durasafe®, the triple-layer substrate used for the new Swiss banknotes, which consist of a layer of plastic sandwiched between two layers of paper.

Bills from the ninth and latest series of Swiss banknotes

(© KEYSTONE / CHRISTIAN MERZ) – Click to enlarge

Durasafe
According to the SNB,

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Swiss industry has learned to live with strong franc

October 28, 2017

An employee of MAN Diesel & Turbo Switzerland grinds turbine blades of a turbo compressor in Zurich in 2015

(Keystone) – Click to enlarge
The recent appreciation of the Swiss franc has sent shockwaves through Swiss firms, resulting in job losses and lower research budgets. But viewed long-term, Switzerland’s export-driven economy has adapted remarkably well to a strong currency.
This is the overall conclusion of five studies, commissioned by the State Secretariat for Economic Affairs (Seco), released on Tuesday. They examined the aftermath of the so-called Swiss franc shock, which was triggered when the Swiss National Bank (SNB) ended its longstanding ceiling of CHF1.20 to the euro almost three years ago. That

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