Three years and four months after introducing its controversial 1.2000 EUR/CHF floor, the Swiss National Bank is
abandoning it. At the same time, SNB decreased the interest rate from its current -0.25% to -0.75%.
EUR/CHF reaction is predictably volatile. The currency pair lost 2600
pips in under 25 minutes. It bounced from 0.94 support level
and currently looks to be more or less stable near 1.04. Though, it may
probably go significantly lower or recover some of the rapid losses
during this trading session yet.
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| EURCHF Cap |
I am not sure why SNB did that. The explanation in the official statement looks inconsistent with their
December monetary policy assessment and with the current macroeconomic situation in the country.
