The Swiss central bank’s foreign- currency reserves surged to a record in May as the euro region’s increasing turmoil forced policy makers to step up their defense of the franc floor.
Currency holdings rose to 303.8 billion Swiss francs ($318 billion) from 237.6 billion francs in April, according to a statement published on the Swiss National Bank’s website today. Walter Meier, a spokesman at the SNB in Zurich, said a “large part” of the increase was due to currency purchases to defend the minimum exchange rate of 1.20 francs per euro.Read it at Bloomberg
SNB Foreign-Currency Holdings Hit Record On Intervention
By Simone Meier
(h/t Warren Mosler)
More evidence that the Swiss are struggling to maintain the currency peg. The expectations channel for central bank policy is clearly not as strong as many believe.
(Note: Stories like this should make it obvious that singling out China as a currency manipulator is just silly.)